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S.Korea won eases, stocks dip as Fed rate comments make investors queasy
May 24, 2016 / 2:27 AM / a year ago

S.Korea won eases, stocks dip as Fed rate comments make investors queasy

* Won trading cautious ahead of Yellen's speech later this
    * KOSPI down on foreign stock sales

    SEOUL, May 24 (Reuters) - The South Korean won edged
down on Tuesday as a stronger  yen, falling global oil prices
and concerns about a possible  U.S. interest rate hike as early
as June made investors wary of riskier assets.
    The won stood at 1,188.7 per dollar as of 0210
GMT, down 0.5 percent compared to Monday's close of 1,182.9.
    "The market seems to be taking a cautious stance ahead of
the Fed Chair Janet Yellen's speech later this week," said Jung
Sung-yoon, a foreign exchange analyst at Hyundai Futures.
    Comments by other U.S. Federal Reserve officials overnight
added to views that a rate hike may be firmly on the table in
June or July, but did not have that much of an impact on the won
as their stance had already been priced in, Jung said.
    Philadelphia Fed President Patrick Harker said that the rate
hike in June is appropriate unless data weakens, while St. Louis
Fed President James Bullard said holding rates too low for too
long could case financial instability.  
    South Korean shares were also down as offshore investors
sold stocks on concerns over the U.S. economy was strong enough
to handle an increase in higher borrowing costs, even if actual
rate levels remain very low.
    The Korea Composite Stock Price Index (KOSPI) was
down 0.5 percent at 1,946.15 points.
    Foreign investors were expected to be sellers, offloading a
net 43.8 billion Korean won ($36.87 million) worth of KOSPI
shares near mid-session, weighing on the index. 
    Chipmaker SK Hynix Inc lost 1.5 percent while 
automobile manufacturer Kia Motors Corp rose 1.6
    Decliners far outnumbered advancers 563 to 244.
    June futures on three-year treasury bonds gained
0.01 point to 110.30. 
                       0210 GMT    Prev close
 Dollar/won             1,188.7       1,812.9
 Yen/won             10.8550/62       10.8182
 *KTB futures            110.30        110.29
 KOSPI                 1,946.15      1,955.25
 * Front-month futures on three-year treasury bonds

 (Reporting by Dahee Kim; Editing by Kim Coghill)

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