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South Korea steel, auto stocks surge but won weaker on Fed caution
September 19, 2017 / 2:33 AM / in 3 months

South Korea steel, auto stocks surge but won weaker on Fed caution

SEOUL (Reuters) - South Korean shares went in and out of negative territory early on Tuesday as caution before the U.S. Federal Reserve’s policy meeting later in the day offset gains in some heavyweight stocks.

A man works on steel products stacked at a steelworks in Seoul July 23, 2014. REUTERS/Kim Hong-Ji

The Korea Composite Stock Price Index (KOSPI) was almost unchanged at 2,417.33 points from Monday’s 2,418.21 points as of 0153 GMT.

Steelmaker Posco rose more than 4 percent to a one-month high on expectations that the company is on track for better quarterly earnings.

Automobile manufacturer Hyundai Motor gained nearly 3 percent while the sub-index for transport equipment that includes auto and auto parts makers rose more than 2 percent.

“Some investors are taking profits from the Seoul market after the KOSPI soared yesterday and they’re watching what could come out of the Fed’s policy meeting,” said Lee Kyung-min, a stock analyst at Daishin Securities.

Investors believe the Fed will hold rates at the two-day meeting, but are eager for clues to whether the Fed will hike rates this year and begin to reduce its bond portfolio as a step to normalizing monetary policy.

Concerns over the Fed pressured the South Korean won to 1,130.30 to the dollar at 0217 GMT, down 0.3 percent versus Monday’s close of 1,126.6

Foreign investors were set to be net sellers, offloading 60.7 billion Korean won ($53.73 million) worth of KOSPI shares near mid-session, weighing on the index.

Decliners slightly outnumbered advancers 396 to 379.

September futures on three-year treasury bonds shed 0.02 point to 109.36.

Reporting by Dahee Kim; Editing by Eric Meijer

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