February 16, 2017 / 3:58 AM / 6 months ago

S.Korea won climbs to 3-month high, stocks edge down

    * Risk of FX manipulator for S.Korea may be supporting
won-analyst
    * KOSPI quickly changes course on institutions'
stock-selling

    SEOUL, Feb 16 (Reuters) - The South Korean won       
rallied to its highest intraday level in more than three months
early on Thursday, after the U.S. dollar pulled back in global
markets.
    The won            was at 1,140.5 to the dollar as of 0315
GMT, up 0.2 percent compared with Wednesday's close of 1,142.2.
It reached a high of 1,133.0, its strongest since Nov. 9, 2016.
    Aside from the dollar's decline overnight, the increasing
likelihood of the won being added to the list of currency
manipulators by the United States seems to be supporting the
won, said Paik Seok-hyun, a foreign exchange analyst at Shinhan
Bank. 
    "There are now more possibilities of South Korea being
designated as one of the manipulating countries by the U.S.,
supporting the won," Paik said, referring to the U.S. Treasury's
twice-yearly report that evaluates the currency policies of its
major trading partners. The next report is due in April.
    Paik added that improved investor sentiment following broad
gains in major stock markets was also triggering higher demand
for emerging currencies.
    The won has risen 1.9 percent so far against the dollar this
month, and is trading near one-year highs against the yen. 
    South Korea's Finance Minister Yoo Il-ho said on Thursday 
he would soon speak with U.S. Treasury Secretary Steven Mnuchin,
after expressing concerns about media reports that described the
won as an undervalued currency.             
    South Korean shares, which briefly touched 19-month intraday
highs, edged down as inshore institutions offloaded local
equities.
    The Korea Composite Stock Price Index (KOSPI)         was
down 0.1 percent at 2,081.22 points. It rose as high as 2,092.59
points immediately after opening, its strongest since July 17 of
2015.
    Foreign investors were set to be net buyers, purchasing 53.4
billion won ($46.83 million) worth of KOSPI shares, while
institutions sold a net 173.5 billion Korean won worth near
mid-session, weighing on the index. 
    Shares of Samsung Electronics             were 1 percent up
ahead of a decision on whether to issue an arrest warrant on
Samsung Group chief Jay Y. Lee over his role in a corruption
scandal that has engulfed President Park Geun-hye.             
    Doosan Bobcat Inc             dropped 5.2 percent, hurt by
its weaker-than-expected fourth-quarter earnings.
    Decliners outnumbered advancers 541 to 251.
    March futures on three-year treasury bonds         gained
0.03 point to 109.55. 
    
                       0315 GMT    Prev close
 Dollar/won             1,140.5       1,142.2
 Yen/won             10.0231/84        9.9341
 *KTB futures            109.55        109.52
 KOSPI                 2,081.22      2,083.86
 * Front-month futures on three-year treasury bonds
    

 (Reporting by Dahee Kim; Editing by Jacqueline Wong)
  

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