Seoul: Won, stocks slip on Brexit worries, US dollar strength

[SEOUL] The South Korean won and shares sagged early on Wednesday as a risk-off mood strengthened due to sterling's sudden fall and a US Federal Reserve official's comments hinting at a rate hike at the end of the year.

The won was quoted at 1,114.0 as of 0221 GMT, down 0.6 per cent compared with Tuesday's close of 1,107.8.

The Korea Composite Stock Price Index (Kospi) was down 0.1 per cent at 2,053.74 points.

The Brexit minister said on Tuesday his government would only negotiate one departure agreement with the European Union, with no separate deal for London - the heart of the country's huge financial sector.

Jeong My Young, a foreign exchange analyst at Samsung Futures, said the minister's remarks caused a sharp fall in sterling, with growing market fears of Brexit fallout pressuring riskier assets including the won.

She added that Fed officials' comments supporting a December rate hike also affected the won.

Offshore investors were set to be sellers, offloading a net 46.8 billion Korean won (S$58 million) worth of Kospi shares near mid-session, weighing on the index.

Samsung Electronics Co Ltd remained steady despite news it will be the sole contract manufacturer of Qualcomm Inc's new high-end Qualcomm Snapdragon 830 chips, after saying in January it would be the sole maker of Qualcomm's Snapdragon 820 chips.

Shares of LG Display Co Ltd gained more than 2 per cent on expectations of positive third-quarter earnings.

Decliners outnumbered advancers 431 to 339.

December futures on three-year treasury bonds shed 0.12 point to 110.75.

REUTERS