Seoul: Won falters after long rally; stocks ease

[SEOUL] The South Korean won fell against the US dollar early on Wednesday, amid continuing consolidation after a two-week long rally ahead of the outcome of the Federal Reserve's policy meeting later in the global day.

The won was quoted at 1,118.9 to the US dollar, down 0.3 per cent, as of 0239 GMT compared with Tuesday's close of 1,115.3.

"Currencies usually move in a narrower range before global events such as when the Fed meets, to be cautious, but the won is moving more than usual today as the currency has risen sharply recently," said Paik Seokhyun, a foreign exchange analyst at Shinhan Bank.

The won rose 3.7 per cent from July 7 to July 24.

Mr Paik expects the won's movements to be quite calm against the US dollar after the Fed concludes its meeting on Wednesday, where it is widely expected to keep rates unchanged. The market's focus will be on the Jackson Hole meeting in August.

South Korean shares fluctuated as upbeat sentiment from Wall Street was offset by foreign investors' continued stock-selling.

The Korea Composite Stock Price Index (Kospi) was down 0.3 per cent at 2,433.48 points.

Offshore investors were poised to be sellers, offloading a net 168.1 billion won (S$204.7 million) worth of Kospi shares near mid-session, weighing on the index.

Hotel Shilla Co Ltd jumped as much as 8.3 per cent to its highest since Sept, 13, 2016, boosted by its better-than-expected second-quarter operating profits.

Software services firm Samsung SDS Co Ltd plunged more than 9 per cent after a research report from global securities company CLSA. The report said Samsung SDS is overvalued and recommends investors sell the stock.

Decliners outnumbered advancers 431 to 360.

September futures on three-year treasury bonds shed 0.05 point to 109.30.

REUTERS