By Kim Tong-hyung
The South Korean won climbed to a 30-month high Monday due to fresh optimism for the global recovery and foreign investors’ increasing appetite for local shares.
The won finished at 1,086.6 per dollar, down from a session high of 1,084.0 but still representing its strongest rate since Sept. 8, 2008. The value of the won has strengthened for five straight trading days, and had closed at 1,091.1 Friday.
The won was strong out of the gate Friday, with the market obviously stoked by the better-than-expected improvement in the U.S. employment situation, although authorities were seen stepping in with “smoothing operations” later in the day to tame the currency’s strength. Foreign investors increasing their holdings of Korean shares for the 13th consecutive day helped push the won further up.
Korea’s foreign-exchange reserves reached a new high of $298.62 billion at the end of March from $297.67 billion a month earlier, due to robust exports and foreign investors’ sustained buying of Korean assets, the Bank of Korea (BOK) said earlier in the day.
The benchmark Korea Composite Stock Price Index (KOSPI) fell 5.14 points to 2,115.87, snapping a seven-day streak of gains. Major oil refiners suffered steep falls in their share prices after the companies showed signs of succumbing to government demands to lower the consumer prices of gasoline and other fuel products.
The share prices of SK Innovation, the parent of SK Energy, the country’s top refiner, plummeted 10.33 percent to 191,000 won after the company announced price cuts for gasoline and diesel for the next three months.
The share prices of GS Holdings, parent of runner-up refiner GS Caltex, also declined 7.47 percent to 87,900 won, and S-Oil’s stock prices tumbled 5.59 percent to 143,500 won on expectations that the smaller players will follow SK’s lead.
The KOSPI had closed at an all-time high of 2,121.01 on Friday.