By Yeawon Choi
SEOUL, Sept 8 (Reuters) - The South Korean won touched a
five-year low by mid-morning on Tuesday on expectations dollar
demand will rise following Tesco 's TSCO.L sale of its largest
overseas unit, Homeplus, in South Korea.
The won's loss was tightly capped as traders suspected
dollar-selling intervention by foreign exchange authorities to
curb the local currency's sharp fall.
The won KRW= KRW=KFTC was down 0.2 percent at 1,205.9
per dollar as of 0153 GMT after falling as low as 1,208.8, the
weakest intraday level since July 22, 2010.
"Pressures are continuously weighing on the won on
expectations for the dollar demand linked to the sale of
Homeplus, but losses will be limited on worries over
intervention by the authorities around 1,210 level," said Jeon
Seung-ji, a foreign exchange analyst at Samsung (KS:005930) Futures.
Jeon mentioned that China's trade data could raise
volatility in the local currency market.
China's trade data is due around 0200 GMT. A Reuters poll
forecast exports in August of -6.0 percent, compared to -8.3
percent in July.
On the stock market, Seoul shares reversed early gains to
edge down as foreigners continuously offloaded local shares,
while exporters bolstered the main board on a weak won.
The Korea Composite Stock Price Index (KOSPI) .KS11 was
down 0.2 percent at 1,880.37 points after gaining as much as 0.6
percent to 1,894.56. Losers outnumbered gainers by 1.7 to 1.
"Valuations divide the share market today as undervalued
exporters rise, while shares with high-valuation such as
pharmaceutical stocks are corrected ahead of the Fed's rate hike
and on concerns over the global economy," said Rhoo Yong-seok, a
stock analyst at Hyundai Securities.
The sub-index for pharmaceutical shares .KS32
underperformed the broad market, down 4.1 percent. Hanmi Pharm
Co Ltd 128940.KS lost 11.2 percent, and Samsung Pharmaceutical
Co Ltd 001360.KS fell 5 percent.
Market bellwether Hyundai Motor Co Ltd 005380.KS rose 2.3
percent, and Hyundai Glovis Co Ltd 086280.KS gained 6.2
percent.
Foreigners were set to extend their selling spree into a
24th consecutive session, offloading a net 68 billion won
($56.41 million) worth of shares in the main board by midday.
September futures on three-year treasury bonds KTBc1 were
down 0.04 points at 109.61.
0153 GMT Prev close
Dollar/won 1,205.9 1,203.7
Yen/won 10.1064/107 10.0805
*KTB futures 109.61 109.65
KOSPI 1,880.37 1,883.22
* Front-month futures on three-year treasury bonds