SEOUL: The South Korean won rose for a second session to its highest in a week early on Thursday, as local exporters sold dollars for month-end settlements while most investors kept to the sidelines, looking for heftier catalysts to move the market.
The local currency was quoted at 1,072.8 against the dollar as of 0238 GMT, up 0.2 percent from Wednesday's domestic close at 1,075.0.
The won touched 1,071.8 shortly after trade commenced, its highest intraday level since March 19.
"We're seeing exporters' dollar sales outweigh dollar demand from importers today...I think we might see the won move above the 1,070 level," one local bank dealer said.
Keeping investors' hands tied on Thursday was the possibility of a rush of dollar sales linked to Korean Air Lines Co Ltd's decision back in December to sell about 30 million shares in South Korean refiner S-Oil.
The airline aims to raise 2.2 trillion won from the deal as it sells the shares to Saudi Arabian Oil Company (Saudi Aramco), which already owns a controlling 35 percent stake in S-Oil.
Local media reports on Thursday said the foreign currency exchange needed for the transaction would likely be made this
month.
However, some investors said the stock purchase would have a limited impact on the market should government foreign exchange authorities decide to intervene in trading.
"If Aramco decides to sell all $2 billion in one go, I think they will choose to minimise the impact it will have on the market by coordinating it with the government," another local bank dealer in Seoul said.
The benchmark Korea Composite Stock Price Index was nearly flat, up 0.1 percent.
June futures on three-year treasury bonds added 0.05 points to trade at 105.74.
Comments
Comments are closed for this article.