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Seoul: Stocks tick up ahead of key events; won inches up
[SEOUL] South Korea's Kospi stock index saw modest gains on Wednesday as investors took a cautious stance ahead of key events. The South Korean won inched up while bond yields rose.
White House economic adviser Larry Kudlow said on Tuesday that US President Donald Trump will have a dinner meeting with Chinese President Xi Jinping at the upcoming G-20 gathering in Argentina and held open the possibility that the two countries would reach a trade deal.
Federal Reserve chairman Jerome Powell will give a speech on "The Federal Reserve's Framework for Monitoring Financial Stability" which will be keenly watched.
All but one of the 16 economists in Reuters poll predicted the Bank of Korea would raise its base rate to 1.75 per cent at its regular board meeting on Friday to calm the property market.
South Korea is expected to post solid export growth this month, however a Reuters poll expects the country to face growing risks from softening computer memory prices and the US-China trade dispute.
At 0632 GMT, the KOSPI was up 8.79 points or 0.42 per cent at 2,108.21.
Investors are taking a wait-and-see stance ahead of Fed chairman Powell's speech scheduled tonight, says Roh Dong-gil, an analyst at Shinhan Investment Corp.
The won was quoted at 1,126.5 per dollar on the onshore settlement platform, 0.26 per cent firmer than its previous close at 1,129.4.
In offshore trading, the won was quoted at 1,126.74 per U.S. dollar, up 0.25 per cent from the previous day, while in one-year non-deliverable forwards it was being asked at 1,106.25 per dollar.
MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.76 per cent, after US stocks ended the previous session with mild gains. Japanese stocks rose 1.02 per cent.
The Kospi is down around 14.9 per cent so far this year, and up by 2.13 per cent in the previous 30 days.
The current price-to-earnings ratio is 12.10, the dividend yield is 1.28 per cent and the market capitalisation is 1,242.04 trillion won.
The trading volume during the session on the KOSPI index was 274,539,000 shares and, of the total 894 traded issues, the number of advancing shares was 400.
Foreigners were net buyers of 112,865 million won worth of shares.
The US dollar has risen 5.66 per cent against the won this year. The won's high for the year is 1,053.55 per dollar on April 2 and the low is 1,146.26 on Oct. 11.
In money and debt markets, December futures on three-year treasury bonds fell 0.05 points to 108.87.
The Korean 3-month Certificate of Deposit benchmark rate was quoted at 1.7 per cent, while the benchmark 3-year Korean treasury bond yielded 1.923 per cent, higher than the previous day's 1.91 per cent.