SEOUL; The South Korean won broke free of an early session lull and rose on Wednesday after the local stock market rallied on renewed risk appetite, although dealers later suspected there were market smoothing operations by government authorities.
The local currency stood at 1,081.5 against the dollar at the end of domestic trade, with a modest gain of 0.2 percent from Tuesday's onshore close at 1,083.4.
The won had been treading water in early trading but was pushed higher as traders erased dollar-long positions, sparked by a rally in the Seoul stock market, which gained 0.6 percent on Wednesday.
Seoul shares neared a 7-week high, shadowing a 3-percent gain in Shanghai shares brought on by comments from new Chinese Communist Party chief Xi Jinping that Beijing will maintain fine-tuning economic policies next year to ensure stable growth.
Market heavyweight Samsung Electronics rose 1.8 percent after announcing the promotion of Jay Y. Lee, the son of its chairman and the anointed heir, to vice chairman.
The won strengthened as exporters sold dollars, but traders said they believe local authorities intervened near the 1,082 level to halt the currency's gain.
"There is a chance the government authorities will keep smoothing out trading to keep the won lower than the 1,080 level," said a foreign bank dealer in Seoul.
Local bond prices fell after offshore investors unloaded contracts on stock market rallies in China and South Korea, with December futures on three-year treasury bonds falling 0.07 points to 105.99.
Yield on the benchmark five-year treasury bonds rose 4 basis points to 2.95 percent, while yield on the three-year treasury bonds added 2 basis points.
Comments
Comments are closed for this article.