DPRK's rocket launch has little impact on S. Korean market

SEOUL -- The planned long-range rocket launch of the Democratic People's Republic of Korea (DPRK) had little impact on the South Korean financial market as the launch was pre- announced, market watchers said Wednesday.

The DPRK's official news agency KCNA reported that the DPRK successfully launched the long-range rocket, saying that the second version of Kwangmyongsong-3 satellite was launched by the Unha-3 carrier rocket from the Sohae Space Center in Cholsan County, North Phyongan Province, and entered pre-set orbit.

Seoul officials were quoted as saying that Pyongyang fired off the three-stage rocket at 9:51 am The first stage of the rocket was reported to fall in the Yellow Sea, before its second stage landed in waters near the Philippines.

The move came two days after the DPRK announced its plan to extend the 13-day launch window by one week until December 29, boosting speculation that the launch would be delayed due to technical problems.

"This will have only a short-lived effect on the markets given that it comes as little surprise. Historically, geo-political events sparked by Pyongyang have had fairly limited, short-lived effects on the markets," said Kwon Young-sun, an economist at Nomura International in Hong Kong.

Kwon expected the South Korean government to do whatever it takes to limit any financial market volatility that may occur on the back of the launch.

South Korean Finance Minister Bahk Jae-wan stressed over the preemptive and swift response to the launch. The authorities " will take necessary actions preemptively and swiftly, while bracing for the possible risk factors in the global financial markets and uncertainties in the economic sector," Bahk said at the crisis management meeting.

Seoul shares traded at positive terrain as the DPRK's rocket launch was already priced in. The benchmark Korea Composite Stock Price Index (KOSPI) rose 4.39 points, or 0.22 percent, to trade at 1,969.01 as of 12:28 am.

"The stock market is little affected by the rocket launch as the news was already priced in. The launch seemed to have no impact on the market," Kang Hyun-gie, a strategist at Solomon Investment & Securities in Seoul, told Xinhua.

Kang noted that the extent of international sanctions on the DPRK's rocket launch will decide on how the financial market will move forward, saying that there has been no impact from the news until now.