KOSPI ends higher despite U.S. tariff uncertainty… “Court ruling to have limited impact on stocks”
Summary
- The KOSPI extended its rally despite uncertainty over U.S. reciprocal tariffs, breaking above 5,900 intraday for the first time and posting a record high on a closing basis.
- Brokerage analysts said the U.S. Supreme Court ruling would have a limited impact on South Korean equities, noting that Korea’s 15% reciprocal tariff rate would be replaced by a 15% universal tariff, leaving the rate unchanged.
- With tariffs on South Korean-made vehicles increasingly likely to be set at the global level of 15%, analysts said the risk of a higher auto tariff burden has been alleviated, while retail and institutions were net buyers and foreigners net sellers.
“U.S. tariff ruling likely to have limited impact on stocks… effects may vary by sector”
The KOSPI extended its rally despite uncertainty surrounding U.S. reciprocal tariffs, at one point breaking above the 5,900 level for the first time ever.
On the 23rd, the KOSPI closed at 5,846.09, up 37.56 points (0.65%) from the previous session. It marked an all-time high on a closing basis. Early in the session, the index jumped as high as 5,931.86, briefly crossing the 5,900 threshold for the first time.
Attention also intensified over the potential fallout for South Korean equities after the U.S. Supreme Court moved to curb the Donald Trump administration’s country-by-country reciprocal tariffs.
Previously, on the 21st, the U.S. Supreme Court ruled that Trump’s reciprocal tariffs imposed under the International Emergency Economic Powers Act (IEEPA), as well as the so-called “fentanyl tariffs” on Mexico, Canada and China, were unlawful.
The court’s key rationale was that the IEEPA does not explicitly grant the president authority to impose tariffs, making its use for that purpose inconsistent with the law.
Trump immediately announced that he had signed an executive order imposing a new 10% tariff on imports from countries worldwide. The following day, he said he would raise it again to 15%.
Brokerage analysts said the Supreme Court’s ruling would have limited impact on South Korean equities and that implications could differ by sector. Kwon Hee-jin, an analyst at KB Securities, said, “In Korea’s case, there is no change in the tariff rate as the 15% reciprocal tariff rate set through negotiations is replaced by the 15% universal tariff under Article 122.”
Kang Sung-jin, also at KB Securities, said, “U.S. tariffs on South Korean-made vehicles are now more likely to be set at the global tariff level of 15%,” adding, “We believe the risk of an increased tariff burden on autos has also been alleviated after the Supreme Court ruling.”
In the main board market, retail and institutional investors posted net buying of KRW 1.3530 trillion and KRW 48.3 billion, respectively. Foreign investors were net sellers by KRW 1.5371 trillion.
Moves among KOSPI heavyweights were mixed. Samsung Electronics, SK Hynix, Hyundai Motor, Kia and HD Hyundai Heavy Industries rose, while LG Energy Solution, Samsung Biologics, Doosan Enerbility and Hanwha Aerospace fell. Samsung Electronics and SK Hynix each extended record intraday rallies, reaching KRW 197,600 and KRW 980,000, respectively.
The Kosdaq fell for a second straight session. The index closed down 0.17% at 1,151.99. In the Kosdaq market, foreigners and retail investors posted net buying of KRW 169.0 billion and KRW 247.7 billion, respectively, while institutions were net sellers by KRW 364.4 billion.
The won-dollar exchange rate declined. In the Seoul FX market, the won-dollar rate ended daytime trading at KRW 1,440.0 per dollar, down KRW 6.6 from the previous session.
Noh Jeong-dong, Hankyung.com reporter dong2@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
