SEOUL, Oct. 12 (Xinhua) -- The South Korean currency surged to the U.S. dollar on Monday on expectations that the U.S. central bank may delay its first interest rate hike to early next year.
U.S. Federal Reserve Vice Chairman Stanley Fischer said on the sidelines of the International Monetary Fund (IMF) meeting in Peru that the Fed's first rate hike this year is"an expectation, not a commitment."
His comments boosted expectations for the postponed rate hike if the U.S. economy shows sluggishness later this year, sending the dollar to weaken to the South Korean won.
The won/dollar exchange rate settled at 1,143.5 won per dollar, down 15.5 won from the previous session. It was the lowest close in about three months.
South Korean stocks ended higher for five straight sessions on hopes that the delay in the U.S. rate increase may have a positive effect on the South Korean economy.
The benchmark Korea Composite Stock Price Index (KOSPI) rose 2. 1 points, or 0.1 percent, to 2,021.63 at the close. Trading volume stood at 624.4 million shares worth 5.99 trillion won (5.24 billion U.S. dollars).
Foreigners lifted stock holdings by 123 billion won, maintaining a buying trend for four sessions in a row. Local financial institutions bought shares worth 97 billion won, but retail investors sold a net 268 billion won worth of stocks.
Earnings surprise from Samsung Electronics, which account for about 15 percent of the total market capitalization, bolstered up expectations for the third-quarter earnings season.
But investors turned cautious about purchasing exporters as the strong South Korean currency could reduce their overseas earnings when repatriated and dampen price competitiveness.
Samsung Electronics shares declined 0.8 percent, and top automaker Hyundai Motor shrank 1.5 percent. Memory chip giant SK Hynix retreated 1.9 percent and the biggest auto parts maker Hyundai Mobis slipped 2.1 percent.
Leading cosmetics maker Amore Pacific tumbled 4.5 percent, and the most-used search engine Naver advanced 2.3 percent.
