S.Korean won up near 6-year high; stocks steady

Sun Jun 8, 2014 11:11pm EDT

* Won supported by risk-on sentiment following ECB meeting
    * Foreigners continue to net buy local stocks
    * Profit taking on Samsung Group units pressure the KOSPI

    SEOUL, June 9 (Reuters) - The South Korean won rose
to its strongest level in nearly six years early on Monday,
playing catch-up to global markets from easing policy by the
European Central Bank while concerns about official intervention
tempered further gains.
    South Korean financial markets were closed on Friday for
Memorial Day.
    The local currency was quoted at 1,017.5 against
the dollar as of 0245 GMT, up 0.3 percent from Thursday's
onshore close at 1,020.5. The won hit an intraday high of
1,017.0 per dollar, the strongest level since Aug. 7, 2008.
    "Suspected dollar bids by local authorities attempted to
weaken the USD/KRW pair's below the 1,020, but took a step back
on robust dollar-selling offers," a currency trader at a local
bank said. "The dollar-short flow appears to be heavy with
offers accruing from a long weekend."
    The European Central Bank cut rates on Thursday and will
pump in money in an effort to steer the bloc away from the
economic quicksand of deflation, promising to do more if all
this is not enough.
    Meanwhile, the yen-won cross touched its weakest
level in nearly six years, giving more cause for the local
authorities to adopt dollar-buying intervention to curb the
won's strength.
    Local authorities may purchase dollars to indirectly curb
the yen's fall against the won, as the won does not trade 
directly against the yen.
    The bid rate on the yen-won cross touched a low
of 9.9084 on Monday, its weakest since Sept. 9, 2008. The cross
rate was bid at 9.9181 as of 0245 GMT.
    In the stock market, the Korea Composite Stock Price Index
(KOSPI) was down 0.1 percent at 1,993.44 points as of
0258 GMT.   
    The risk-on sentiment stemming from upbeat economic
indicators around the globe was offset by profit taking in the
units of Samsung Group.
    China's exports gained steam in May thanks to firmer global
demand, data showed on Sunday. Meanwhile, data on Friday showed
U.S. employment had returned to its pre-recession peak in May
with a solid pace of hiring.  
    The upbeat results from South Korea's three major export
markets prompted extended capital inflows from offshore
investors, with foreign investors purchasing a net 60 billion
won ($59 million) worth of KOSPI shares near mid-session. 
    Foreigners have positioned as net buyers for 17 consecutive
sessions through Thursday, bringing in nearly 3.1 trillion won
during their buying spree.
    Market bellwether Samsung Electronics Co Ltd 
fell 1.9 percent as investors locked in gains after posting the
best monthly performance in May since December 2012.
    Affiliate Samsung C&T Corp plunged 6.2 percent
following a 12.6 percent rise last month.
    Steelmaker POSCO rose 2.1 percent while crude
oil refiner SK Innovation Co Ltd advanced 3.9
percent.
                       0245 GMT    Prev close
 Dollar/won            1,017.5       1,020.5
 Yen/won            9.9230/181        9.9454
 *KTB futures           106.05        106.04
 KOSPI                1,993.44      1,995.48
 * Front-month futures on three-year treasury bonds
    ($1 = 1017.2000 South Korean Won)

 (Reporting by Jungmin Jang; Additional reporting by Yena Park;
Editing by Jacqueline Wong)
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