The South Korean benchmark Kospi plummeted and the Korean won lost value against the US dollar on Thursday, pressured by US President Donald Trump's tariff plan.
The Kospi closed daytime trading at 2,486.7, down 19.16 points, or 0.76 percent, falling below the 2,500 threshold. The benchmark started the session at 2,437.43, down 2.7 percent from the previous day as investors responded to Trump’s announcement of new "reciprocal" tariffs on imports from all other countries, including Korea. The index partially recovered later in the day and peaked at 2,488.92.
Foreign investors drove the index lower by dumping shares worth 1.37 trillion won ($890 million) on the market. Retail and institutional investors net bought 800 billion won and 270 billion won, respectively.
Though large-cap shares plummeted, biopharmaceutical stocks saw gains, driven by anticipation that the tariff policy will have a limited impact on the local pharmaceutical industry. Pharmaceuticals were exempt from Trump's tariffs, though industry uncertainty persists. Local pharma giants Samsung Biologics and Celltrion soared by 6 percent and 2.24 percent, respectively.
The secondary bourse Kosdaq closed at 683.49, down 1.36 points, or 0.2 percent, from the previous session’s close.
The Korean won closed at 1,467 won per dollar, depreciating against the greenback by 0.4 won from the previous day.
The won started trading at 1,471 won per dollar and depreciated to 1,472.5 won during intraday trading, but regained some value as the greenback devalued on concerns that the US economy will face a growing risk of recession as the new tariffs threaten growth.
In response to the volatility of the local capital market, Financial Minister Choi Sang-mok pledged to "deploy all available measures to stabilize the market in the event of excessive volatility” at a meeting on Thursday with the country's top financial policymakers, including the heads of the Bank of Korea, the Financial Services Commission and the Financial Supervisory Service.
silverstar@heraldcorp.com
