* KOSPI hits 5-week high, but pares gain on earnings worry
* KOSPI headed for best weekly gain in a month
* Won hovers at 6-year high, up 0.5 pct for the week
SEOUL, July 4 South Korean shares held their
ground after hitting a five-week high on Friday morning, as
lingering concerns over weak quarterly earnings offset a
surprisingly strong U.S. jobs report while the won
steadied at a six-year high.
The Korea Composite Stock Price Index (KOSPI) was up
0.1 percent at 2,012.62 points as of 0215 GMT after hitting an
intraday high of 2,018.35 at opening, the highest intraday level
since May 30. It was up 1.2 percent for the week and headed for
the best weekly rise since mid-May.
"The market is dithering, with the grim earnings outlook
continuing to cap the upside despite the upbeat U.S. jobs report
supporting sentiment," said Kim Yong-goo, an analyst at Samsung
"What's more concerning is that earnings in second-half do
not look optimistic - with the pace of won's appreciation.
Small- and mid-cap exporters which do not have as much leverage
as large-caps to hedge currency risks will suffer further," Kim
The South Korean won strengthened 5.2 percent against the
dollar in the second quarter alone, with a growing view that the
currency will gain even more by year-end. Traders expect the
risk-on sentiment to prevail through the end of the U.S. Federal
Reserve's quantitative easing programme.
SK Hynix Inc, the world's second-largest maker
of memory chips, fell 2.4 percent as investors locked in profits
after gaining a total of 5 percent in the previous two sessions.
Samsung Electronics Co Ltd, the biggest
component in KOSPI, edged down 0.4 percent and automaker Kia
Motors Corp slipped 1.1 percent.
The U.S. government said on Thursday that nonfarm payrolls
increased by 288,000 in June, above a Reuters poll forecast of
212,000, while unemployment fell to 6.1 percent in June - the
lowest in six years.
The local currency was quoted at 1,008.8 against
the dollar as of 0215 GMT, compared with Thursday's onshore
close at 1,008.5.
The won touched an intraday high of 1,008.4 per dollar
during the morning session, the strongest level since July 30,
2008. On a weekly basis, the won is up 0.5 percent and heading
for a second consecutive week of gains.
A Reuters poll on Thursday found long positions in the won
increased to their largest since January 2013 as sustained
capital inflows and a continuous current account surplus lifted
the currency to a six-year high.
0215 GMT Prev close
Dollar/won 1,008.8 1,008.5
Yen/won 9.8815/757 9.8713
*KTB futures 106.71 106.68
KOSPI 2,012.62 2,010.97
* Front-month futures on three-year treasury bonds
(Reporting by Jungmin Jang; Editing by Eric Meijer)