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South Korea: Stocks rise as US jobs data, China stimulus buoy sentiment

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[SEOUL] South Korea's KOSPI stock index rose on Monday tracking its Chinese peer, as US jobs data and more China stimulus boosted investor sentiment. The Korean won slid while the benchmark bond yield also fell.

US employment growth accelerated from a 17-month low in March, assuaging fears of an abrupt slowdown in economic activity, but a moderation in wage gains supported the Federal Reserve's decision to suspend further interest rate increases this year.

China will step up its policy of targeted cuts to banks' required reserve ratios to encourage financing for small and medium-sized businesses that play a key role in economic growth.

The Seoul stock market's main KOSPI rose 6.52 points or 0.30 per cent to 2,216.13 points.

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Shares of Korean Air Lines' parent Hanjin Group's subsidiaries jumped on hopes for leadership renewal after the group's Chairman Cho Yang-ho passed away on Monday due to a chronic ailment. Korean Air gained 3.8 per cent, while Hanjin Kal Corp and Hanjin Transportation Co Ltd surged 17.7 per cent and 13.2 per cent, respectively.

Foreigners were net buyers of 86.0 billion won worth of shares on the main board.

The won was quoted at 1,138.8 per dollar on the onshore settlement platform, 0.19 per cent lower than its previous close at 1,136.6.

In offshore trading, the won was quoted at 1,138.4 per US dollar, down 0.2 per cent from the previous day, while in one-year non-deliverable forward trading its one-month contract was quoted at 1,137.2 per dollar.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.45 per cent, after US stocks ended its previous session with mild gains . Japanese stocks rose 0.09 per cent.

The KOSPI has risen 8.58 per cent so far this year, and has fallen 0.9 per cent in the previous 30 trading sessions.

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 167.46 million shares and, of the total traded issues of 895, the number of advancing shares was 445.

The won has lost 2.0 per cent against the US dollar this year.

In money and debt markets, June futures on three-year treasury bonds rose 0.05 points to 109.57, while the three-month Certificate of Deposit rate was quoted at 1.86 per cent.

The most liquid 3-year Korean treasury bond yield fell 0.8 basis points to 1.727 per cent, while the benchmark 10-year yield eased 2.1 basis points to 1.871 per cent.

Norway's sovereign wealth fund, the world's largest, will streamline its US$300 billion fixed-income portfolio by cutting emerging market bonds from the benchmark index it tracks, the Finance Ministry said on Friday. Government and corporate bonds including US$6.3 billion worth bonds issued by South Korea would be affected.

REUTERS