[Morning Briefing] New York Stock Exchange, Concerns of Stagflation Lead to Decline in Three Major Indices

◆ New York Stock Exchange, Concerns of Stagflation…Ends with Decline

The three major indices of the New York Stock Exchange fell together. On the 20th local time, the Dow Jones Industrial Average closed at 41,953.32, down 0.03% from the previous session. The S&P 500 index fell 0.22% to 5,662.89, and the Nasdaq index dropped 0.33% to 17,691.63. Despite the dovish Federal Open Market Committee (FOMC) results, major indices showed strength, but concerns about stagflation were raised, and tariff uncertainties remained, causing the market to give up its gains. This is interpreted as due to the continued tariff uncertainties until April 2, the date set by Trump for reciprocal tariffs to take effect, and the FOMC content not being entirely optimistic.

◆ Trump "Imminent Signing of Rare Earth Mineral Agreement with Ukraine"

U.S. President Donald Trump announced on the 20th local time that "we will very soon sign a rare earth mineral agreement with Ukraine." President Trump stated, "We are doing very well with Ukraine and Russia (for peace negotiations)" and "Ukraine's rare earths have tremendous value." The U.S. has been demanding mining rights for key minerals, including rare earths buried within Ukrainian territory, in exchange for military support to Ukraine.

President Trump previously stated, "I have just signed an executive order to dramatically increase the production of key minerals and rare earths," adding, "As you know, we are set to sign agreements in various places to secure rare earths, minerals, and many other things worldwide." According to Bloomberg News, the executive order signed by President Trump provides financial, loan, and investment support for key mineral projects using the Defense Production Act (DPA). The executive order encourages relevant departments to expedite the necessary permits for mineral mining and processing projects and instructs the Department of the Interior, which manages federal lands, to prioritize mineral production.

◆ Will the Partial Ceasefire Between Russia and Ukraine Lead to a Signing?

Before the specific details of the U.S.-Russia summit agreement to suspend attacks on each other's energy infrastructure (U.S. announcement is energy and infrastructure) for 30 days were coordinated, differences in positions among the related parties have emerged. On the 18th local time, President Trump agreed on a 'partial ceasefire plan' through a phone consultation with Russian President Vladimir Putin, and on the 19th, he succeeded in obtaining agreement from Ukrainian President Volodymyr Zelensky through a call. However, differences in positions between the U.S. and Russia were immediately exposed over the issue of suspending military and intelligence support to Ukraine, which Russia demanded during the Trump-Putin call. President Trump promised to continue sharing intelligence for Ukraine's defense during his call with President Zelensky and expressed willingness to cooperate on Zelensky's request for Patriot missile defense system support. A Russian Foreign Ministry spokesperson stated in a briefing on the 20th that "supplying weapons to the Kyiv regime contradicts the U.S.'s declared intention to achieve peace and make everything conform to political and diplomatic solutions." If Russia's demand for support suspension is presented as a condition for the next step, 'full ceasefire,' it may not be an obstacle to the 'partial ceasefire,' but if it is set as a condition for the 'partial ceasefire,' the situation may change.

◆ 'Yoon Arrest Prevention' Kim Sung-hoon, Deputy Chief of Security, Faces Arrest Decision

The decision on whether to arrest Kim Sung-hoon, deputy chief of the Presidential Security Service, and Lee Kwang-woo, head of the Security Headquarters, who are accused of obstructing the arrest of President Yoon Suk-yeol, will be made as early as the 21st. The Seoul Western District Court will hold a pre-arrest interrogation (warrant review) for Kim and Lee at 10:30 a.m. on this day. Kim and Lee are accused of obstructing the first arrest operation of President Yoon by the police and the High-ranking Officials' Crime Investigation Office (special obstruction of official duties). They are also accused of unfairly reassigning security service executives who did not follow the arrest prevention order or instructing the deletion of security phone (encrypted phone) records (abuse of authority under the Presidential Security Act).

◆ Generally Clear and Mild Nationwide…'Bad' Fine Dust in the Capital Area

On the 21st, the day of the week, it will be generally clear nationwide, but there will be occasional clouds in the central inland until the morning. The highest daytime temperature is forecasted to be 13 to 22 degrees. For the time being, it will be 3 to 10 degrees higher than the average (morning -2 to 6 degrees, daytime 11 to 15 degrees), and the temperature difference between day and night will be around 15 degrees, so be careful with health management during the changing seasons. The fine dust concentration is expected to be 'bad' in the capital area, Gangwon Yeongseo, Chungcheong area, Gwangju, Jeonbuk, Busan, and Jeju area, and 'normal' in other regions, while it is expected to be 'bad' in the morning in Gangwon Yeongdong, Daegu, Ulsan, Gyeongbuk, and Gyeongnam.

Kim Ye-rang, Hankyung.com reporter yesrang@hankyung.com