North Korea’s missile launch limited on financial markets

North Korea’s missile launch Sunday had little impact on South Korea’s financial markets Monday.

North Korea on Sunday morning launched the Pukguksong-2 missile, which North Korea’s state news agency described as a “surface-to-surface medium- to-long-range ballistic missile.” 

Despite the heightened tension, South Korea’s bourses remained stable Monday.

The benchmark Korea Composite Stock Price Index opened 0.01 percent lower but closed up 0.17 percent, or 3.57 points, to 2,078.65 points Monday. The tech-heavy Kosdaq opened 0.17 percent up and ended Monday’s session with a 0.22 percent gain to close at 611.94 points.

“Since the missile launch was conducted on Sunday when the markets were closed, it would have no direct impact on the financial market,” said a government statement co-issued by financial authorities including the Ministry of Strategy and Finance and the Bank of Korea.

The statement also added that North Korea’s provocations in the past have had little or only temporary impact on South Korea’s markets.

The authorities, nonetheless, vowed to thoroughly monitor any volatility over the North Korea provocation.

The foreign exchange market also showed little volatility Monday.

The Korean won opened down 1.5 won to 1,149.5 won against the US dollar, but closed at 1,150.50 won against the greenback, up 0.50 won, or 0.04 percent from the previous session.

“Most foreign investors I’ve met are not interested in North Korean issues or the inter-Korean relationship,” said an official at Korea Exchange. “They are more interested in corporate governance.”

Meanwhile, shares in Samsung Electronics fell by over 1.6 percent during trading before closing down 1.04 percent, or 20,000 won ($17.36), to 1,898,000 won on Monday, as the company’s vice president was resummoned by the special investigation team looking into a political scandal involving President Park Geun-hye.

By Park Ga-young (gypark@heraldcorp.com)