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Seoul: Stocks, won gain on BOJ decision to keep rates low

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[SEOUL] South Korea's KOSPI stock index and the won rose on Tuesday after Bank of Japan decided to keep main policy targets unchanged but added flexibility around them. Investors also await several other central bank meetings later this week. South Korean bond yields fell.

At 0633 GMT, the Kospi was up 1.75 points or 0.08 per cent at 2,295.26. South Korean stocks with North Korea exposure tumbled despite military talks between the two Koreas held early during the day, as US spy satellites have detected renewed activity at the North Korean factory that produced the country's first intercontinental ballistic missiles capable of reaching the United States, a senior US official said on Monday. Shares of Daea TI Co Ltd and Korea Cement Co Ltd closed down 4.9 per cent and 4.6 per cent, respectively.

The won was quoted at 1,118.7 per dollar on the onshore settlement platform, 0.13 per cent firmer than its previous close at 1,120.2. In offshore trading, the won was quoted at 1,118.37 per US dollar, down 0.07 per cent from the previous day, while in one-year non-deliverable forwards it was being transacted at 1,101.8 per dollar.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.27 per cent, after U.S. stocks ended the previous session with losses after a broad sell-off of technology stocks. Japanese stocks rose 0.04 per cent.

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The KOSPI is down around 7.1 per cent so far this year, and down by 3.48 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 217,651,000 shares and, of the total 894 traded issues, the number of advancing shares was 444.

Foreigners were net sellers of 71,838 million won worth of shares. The US dollar has risen 4.88 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 1,140.4 on July 19. In money and debt markets, September futures on three-year treasury bonds rose 0.06 points to 108.1. The Korean three-month Certificate of Deposit benchmark rate was quoted at 1.65 per cent, while the benchmark three-year Korean treasury bond yielded 2.118 per cent, lower than the previous day's 2.13 per cent.

REUTERS