Seoul: Stocks up; won falls on Trump's trade threats

[SEOUL] South Korea's Kospi stock index rose on Friday while other Asian shares fell after a report that US President Donald Trump is preparing to step up a trade war with Beijing and ready to impose more tariffs on Chinese imports. The won fell and bond yields also dropped.

At 0632 GMT, the KOSPI was up 15.53 points or 0.67 per cent at 2,322.88. The benchmark index rose 1.3 per cent on a weekly basis, while it also rose 1.2 per cent for the month.

Global issues such as trade tensions have damaged the country's benchmark index hard compared to other emerging markets, though KOSPI's fundamental isn't that bad. Cases such as Kospi rising despite global market's fall happens once investors realise concerns have been excessive compared to fundamentals. There are possibilities that KOSPI would outperform other emerging markets, said Moon Dong-yeol, an analyst at Samsung Securities.

The won was quoted at 1,112.9 per dollar on the onshore settlement platform, 0.39 per cent weaker than its previous close at 1,108.6. For the week, the won edged up 0.5 per cent, extending weekly gains to a third week. However, it gained 0.5 per cent on a monthly basis.

In offshore trading, the won was quoted at 1,113.24 per US dollar, up 0.05 per cent from the previous day, while in one-year non-deliverable forwards it was being transacted at 1,096.95 per dollar. MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.59 per cent, after US stocks ended the previous session with mild losses. Japanese stocks weakened 0.02 per cent.

The KOSPI is down around 6.5 per cent so far this year, and up by 0.75 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 240,587,000 shares and, of the total 897 traded issues, the number of advancing shares was 471. Foreigners were net buyers of 314,305 million won worth of shares. The US dollar has risen 4.4 percent 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 1,140.4 on July 19.

In money and debt markets, September futures on three-year treasury bonds rose 0.21 points to 108.88. The Korean three-month Certificate of Deposit benchmark rate was quoted at 1.65 per cent, while the benchmark 3-year Korean treasury bond yielded 1.925 per cent, lower than the previous day's 1.98 per cent.

REUTERS