S.Korea won climbs to near 6-year high, stocks on losing streak

Tue May 6, 2014 11:11pm EDT

* Won hits new near 6-year high on dollar slide
    * KOSPI set for 8th day of losses, longest in 14 years

    SEOUL, May 7 (Reuters) - The South Korean won rose to
a fresh nearly six-year high on Wednesday morning after a long
public holiday as the dollar eased, while local stocks extended
losses to a six-week trough.
    South Korean financial markets were closed on Monday and
Tuesday for public holidays.
    The local currency was quoted at 1,027.0 against
the dollar as of 0237 GMT, up 0.3 percent from Friday's onshore
close at 1,030.3. The won hit as high as 1,026.0, the strongest
since Aug. 8, 2008.
    "The non-deliverable forwards have persistently bolstered
the won on favourable variables during the onshore market close,
and such momentum is carrying over," said Woori Futures analyst
Son Eun-jung. She was referring to upbeat U.S. nonfarm payrolls
data and the euro zone factory activity survey, which helped
risk sentiment, while the dollar eased on the Fed's dovish
comments on a rate hike.
    "Fed chief Janet Yellen is expected to speak in a dovish
tone at the congressional testimony later today to extend the
dollar's weakness, but caution over possible intervention by
local authorities will check the won's rise," added Woori's Son.
    The Korea Composite Stock Price Index (KOSPI) was
down 0.9 percent at 1,941.50 points as of 0237 GMT after
touching an intraday low of 1,940.02, the weakest since March
25. The KOSPI is headed for an eight straight session of losses,
which will be the longest skid since a 9-day losing streak set
in early September, 2000.
    "The grim corporate earnings results appear to be extending
over to the second quarter at this moment, and investors are
searching for new variables from the U.S. and China while
tensions in the Ukraine continue to escalate," said Lee
Jae-mahn, an analyst at Hana Daetoo Securities.
    "At a time of absence in momentum, the market goes downward,
not sideways."
    Foreign investors sold a net 121 billion won ($117.4
million) worth of KOSPI shares near mid-session, weighing on the
index. 
    Grim January-March quarter earnings results dragged
shipbuilders, with Hyundai Heavy Industries Co Ltd 
dropping 2.1 percent and Samsung Heavy Industries Co Ltd
 down 3.5 percent.
    June futures on three-year treasury bonds ticked up
0.03 points to 105.87 as investors rotated into fixed-income
assets from equities. 
       
                       0237 GMT    Prev close
 Dollar/won            1,027.0       1,030.3
 Yen/won           10.1013/092       10.1229
 *KTB futures           105.87        105.84
 KOSPI                1,941.50      1,959.44
 * Front-month futures on three-year treasury bonds
   ($1 = 1030.3000 Korean Won)

 (Reporting by Jungmin Jang; Editing by Jacqueline Wong)
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