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S.Korea won, stocks fall on heightened N.Korea risks
April 14, 2017 / 3:38 AM / 7 months ago

S.Korea won, stocks fall on heightened N.Korea risks

    * Won adjusting amid N.Korea worries -analyst
    * Won's direction to be set by N.Korea's "Day of the Sun"

    SEOUL, April 14 (Reuters) - The South Korean won        fell
by more than 1 percent early on Friday as media reports of a
possible weapons test by North Korea and its potential
consequences continued to unnerve financial markets.  
    U.S. President Donald Trump said on Thursday that North
Korea was a problem that "will be taken care of," while China
also issued warnings as speculation rose that North Korea might
be on the verge of a sixth nuclear test.             
            
    The won            stood at 1,138.7 against the dollar as of
0326 GMT, down 0.8 percent versus Thursday's close of 1,129.7,
after touching as low as 1,141.0.
    South Korean shares also fell, with the Korea Composite
Stock Price Index (KOSPI)         down 0.4 percent at 2,139.14
points.
    Min Gyeong-won, a foreign exchange analyst at NH Futures
said that the won is correcting after a spiking on Thursday amid
heightened geopolitical risks ahead of North Korea's biggest
national day, the "Day of the Sun" on Saturday. 
    A military parade is expected in Pyongyang to mark the day. 
    "The won's next direction will be decided after North
Korea's national day is over," added Min.
    The cost of insuring sovereign debt remained at its highest
since June last year, with South Korean 5-year credit default
swaps                 at 58/59 basis point, indicating that it
is becoming costlier to insure South Korean debt across all
maturities. 
    "Many are closely watching (North Korean) events on Saturday
as it could be a turning point and a pose a buying opportunity.
Before that, it is natural that South Korean markets are falling
more than other Asian markets," a currency trader in Seoul said.
    Offshore investors were set to be net sellers, offloading
30.7 billion Korean won ($27.02 million) worth of KOSPI shares
near mid-session. 
    Decliners outnumbered advancers 523 to 269.
    June futures on three-year treasury bonds         gained
0.02 point to 109.47. 
    
                       0326 GMT    Prev close
 Dollar/won             1,138.7       1,129.7
 Yen/won             10.4259/42       10.4053
 *KTB futures            109.47        109.45
 KOSPI                 2,139.14      2,148.61
 * Front-month futures on three-year treasury bonds
    

 (Reporting by Dahee Kim; Editing by Eric Meijer)
  

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