Police launch investigation into South Korean president over 'insurrection'

South Korean police have begun investigating President Yoon Suk Yeol for alleged "insurrection" over his declaration of martial law, a senior police officer has said.

On Thursday, Woo Jong-soo, head of the National Investigation Headquarters of the National Police Agency, told lawmakers that "the case has been assigned," footage showed.

South Korean President Yoon Suk Yeol was still clinging to power, with his party announcing they will oppose an impeachment motion after his short-lived imposition of martial law stunned the world.

Yoon suspended civilian rule late on Tuesday and deployed troops and helicopters to parliament only for lawmakers to vote down the measure and force him into a U-turn in a night of protests and drama.

The opposition quickly filed an impeachment motion saying Yoon "gravely violated the constitution and the law".

A vote in the parliament on the proposed impeachment is scheduled for Saturday at around 7:00 pm (1000 GMT), according to news agency Yonhap.

'Limited implications for the economy'

Meanwhile, equities extended losses in Seoul on Thursday, while the won stabilised as South Korea entered a period of uncertainty with martial law turmoil.

The upheaval comes as Asia's number-three economy struggles to gain traction and worries build on the possible impact of Donald Trump's presidency as he prepares to reignite his hardball trade policy when he takes power next month.

But analysts saw some optimism.

"The silver lining we think is that the swift reversal of the martial law underscores the resilience of South Korea's institutions," said analysts at BMI, a unit of Fitch Solutions.

"For now, we expect limited implications for the economy and financial markets as the Bank of Korea and the Ministry of Finance have responded swiftly by reassuring investors.

"Notably, the central bank committed to boosting short-term liquidity and enacting measures to stabilise the forex markets, which aligns with our view that risks around the South Korean won should remain contained for now."

In early trade, Seoul's Kospi was down 0.3 percent, having finished more than one percent down on Wednesday - itself an improvement on the initial drop.

And the won remained at around 1,415 to the dollar, slightly up from its levels before the crisis erupted when it sank about three percent.