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S.Korea won, stocks recoil after Trump threatens to scrap trade deal
April 28, 2017 / 3:03 AM / 7 months ago

S.Korea won, stocks recoil after Trump threatens to scrap trade deal

    * Trump comments understood as a protectionist signal
    * Doubtful on won's downward trend yet -analyst
    * KOSPI erases earlier gains

    SEOUL, April 28 (Reuters) - The South Korean won        and
shares retreated on Friday after 
U.S. President Donald Trump told Reuters he would either
renegotiate or terminate a free trade deal with Seoul.
    A high-ranking South Korean official said the government is
adopting a "wait and see" stance, having not yet received any
formal request for a renegotiation.             
    "Talk and actual policy are different," the official at the
finance ministry, who declined to be identified, told Reuters.
    The won            stood at 1,132.6 against the dollar as of
0237 GMT, down 0.2 percent versus Thursday's close of 1,130.1.
    The Korea Composite Stock Price Index (KOSPI)        
surrendered modest early gains and was down 0.1 percent at
2,208.00 points.
    "Trump's such negative comments about the Free Trade
Agreement between the two countries can be understood as a sign
of protectionism, pressuring the local currency," said Jung
Sung-yoon, a foreign exchange analyst at Hyundai Futures. 
    Jung added, however, that it was too early to tell if the
won would extend its losses against the dollar, noting there is
still much uncertainty over U.S. fiscal policies including tax
cuts and reforms which are weighing on the greenback.
    Offshore investors were poised to snap a six-day buying
streak, offloading a net 40.8 billion Korean won ($36.02
million) worth of KOSPI shares near mid-session.
    Decliners outnumbered advancers 555 to 229.
    The sub-index for transportation equipment         was down
1.x percent with Hyundai Motor             drop as much as 2.4
percent and Hyundai Mobis             down 1.3 percent.
    Market heavyweight Samsung Electronics             jumped to
hit record high, gaining as much as 4.5 percent, on hopes of
strongest quarterly earnings ever for April-June period.
    June futures on three-year treasury bonds         gain 0.01
point to 109.46. 
                       0237 GMT    Prev close
 Dollar/won             1,132.6       1,130.1
 Yen/won             10.1880/25       10.1604
 *KTB futures            109.46        109.45
 KOSPI                 2,208.00      2,209.46
 * Front-month futures on three-year treasury bonds

 (Reporting by Dahee Kim; Editing by Kim Coghill)

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