June 17, 2020 / 7:35 AM / 23 days ago

S.Korean shares inch higher as retail investors look past N.Korea risks

* KOSPI rises, foreigners net sellers

* Korean won weakens versus U.S. dollar

* South Korea benchmark bond yield rises

* For the midday report, please click

SEOUL, June 17 (Reuters) - Round-up of South Korean financial markets:

** South Korean shares gained on Wednesday, reversing a more than 1.5% decline in the early session, as retail investors shrugged off worries of rising tensions with North Korea and stayed focused on hopes of economic recovery amid the pandemic. The Korean won weakened, while the benchmark bond yield rose.

** The Seoul stock market’s main KOSPI closed up 3.00 points, or 0.14%, at 2,141.05.

** Recovery hopes were fuelled by data showing U.S. retail sales increased by the most on record in May after two straight months of sharp declines, offering more evidence the recession triggered by the COVID-19 pandemic was over or drawing to an end.

** Shares fell as much as 1.5% in early session after North Korea on Wednesday rejected South Korea’s offer to send special envoys to ease escalating tensions over defector activity and stalled reconciliation efforts, vowing to redeploy troops to demilitarised border units.

** North Korea issues may increase volatility of stock prices during a session, but it does not tend to have a meaningful impact on the market, said Seo Sang-young, an analyst at Kiwoom Securities.

** Shares of South Korean defence-related companies surged due to the heightened geopolitical risks.

** Foreigners were net sellers of 52.2 billion won ($43.00 million) worth of shares on the main board, while retail investors net purchased 151.5 billion won worth of shares.

** The won closed trading 0.55% lower at 1,213.9 per dollar on the onshore settlement platform.

** In offshore trading, the won was quoted down 0.2% at 1,214.0 per dollar, while in non-deliverable forward trading its one-month contract was quoted at 1,213.8.

** The most liquid 3-year Korean treasury bond yield rose by 1.4 basis points to 0.874%, while the benchmark 10-year yield rose by 0.8 basis point to 1.408%. ($1 = 1,214.0600 won) (Reporting by Jihoon Lee; Editing by Krishna Chandra Eluri)

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