Won depreciates against dollar to 1,480 won range, Kospi struggles
While the National Assembly passed the motion to impeach acting President Han Duck-soo on Friday, marking the first suspension of an acting South Korean president, volatility in the local capital market escalated with the sharp devaluation of the won and a stock market plunge.
With higher tensions in local politics, the value of the Korean currency against the dollar fluctuated by nearly 20 won during trading Friday. Won-dollar trading started at 1,467.5 won and peaked at 1,486.7 won during intraday trading.
After reaching the high, the won gained strength and the daytime trading wrapped up at 1467.5 won, with the won depreciating by 2.7 won from the previous trading day.
It was the first time the won-dollar currency exchange rate hit the 1,480 won bar in nearly 16 years since it reached 1,488.5 won on March 16, 2009, amid the global financial crisis.
During after-hours trading, the won’s value against the dollar dropped to 1,475 won as of 4:45 p.m. after the National Assembly approved the motion to impeach Han.
The Kospi closed at 2,404.77, down 24.9 points or 1.02 percent from the previous trading day. It dipped to 2,388.33 during trading with the dollar's rise, but later marked a slight gain as the won-dollar currency stabilized.
Foreign and institutional investors net sold shares worth 173 billion won and 114.6 billion won, respectively, on the Kospi market Friday. Retailers net purchased 214 billion won.
The Kospi fell below 2,400 for the first time in four trading days since it dipped to 2,390 during intraday trading on Dec. 20.
The Kosdaq wrapped up trading at 665.97, down 9.67 points or 1.43 percent, on-day.
