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Seoul shares end 0.33 pct up amid currency woes

South Korean stocks closed 0.33 percent higher Tuesday, as renewed fear over local currency's rise against major global currencies weighed down investor confidence, analysts said. The Korean won gathered ground against the U.S.dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) added 6.66 points to finish at 2,022.64. Trading volume was light at 269.7 million shares worth 3.39 trillion won ($3.19 billion) with gainers outpacing losers 408 to 386.

The KOSPI started off the session sharply lower, led by foreign and institution-led net selling. But it gathered ground toward the closing bell as they both turned to net buyers of local stocks.

Analysts said investors were cautious to make bets in local equities due largely to the rising streak of the won, amid lack of further upward momentum to fuel the market since the U.S. Federal Reserve's pledge to keep the stimulus cut on hold.

"The merit of an undervalued won has deteriorated due to the weakening yen. It's too early to see the won's appreciation as a downside risk that undermines industrial competitiveness, but a volatile currency certainly affects investor confidence," said Kim Hyung-ryeol, an analyst at Kyobo Securities Co.

The Korean won gained sharply against both the U.S. dollar and the yen in the recent month. The won hit a five-year high against the Japanese currency last Friday, stoking fresh concerns it may hinder competitiveness of the local economy, which heavily depends on exports for growth.

Amid the currency volatility, foreigners and institutions bought a net 23.1 billion won and 19.4 billion won each, while retail investors unloaded a net 43.2 billion won.

Shares of telecom companies and large exporters shored up the main index. Top mobile carrier SK Telecom gained 2.34 percent to 219,000 won, and market behemoth Samsung Electronics climbed 0.96 percent to 1,479,000 won.

In contrast, textile firms and steelmakers finished bearish.

Leading apparel company LG Fashion slumped 3.72 percent to 32,350 won, and POSCO fell 0.46 percent to 324,000 won.

The local currency ended at 1,059.90 won against the greenback, up 2 won from Monday's close, amid the continuing streak of a stronger won, dealers said. (Yonhap News)

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