{"id":2206039,"date":"2024-08-06T08:00:48","date_gmt":"2024-08-05T23:00:48","guid":{"rendered":"https:\/\/koreapro.org\/?p=2206039"},"modified":"2024-08-05T18:24:22","modified_gmt":"2024-08-05T09:24:22","slug":"south-koreas-stock-market-sinks-as-us-economic-woes-spark-global-sell-off","status":"publish","type":"post","link":"https:\/\/koreapro.org\/2024\/08\/south-koreas-stock-market-sinks-as-us-economic-woes-spark-global-sell-off\/","title":{"rendered":"South Korea\u2019s stock market sinks as US economic woes spark global sell-off"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">The Korea Composite Stock Price Index (KOSPI) plunged a record 8.77%, or 234.64 points, to close at 2,441.55 on Monday, its lowest since Nov. 2023. The sharp decline, triggered by fears of a U.S. economic slowdown following disappointing employment data and weak big tech performance, prompted a 20-minute trading halt, the first since March 2020.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Foreign investors spearheaded the sell-off, dumping a net $1.09 billion (1.5 trillion won) in stocks, with major tech firms Samsung Electronics and SK Hynix among the hardest hit. The South Korean won weakened against the U.S. dollar, while bond prices surged as investors sought safer assets amid growing concerns over the potential spillover effects of a U.S. recession on South Korea\u2019s export-dependent economy.<\/span><\/p>\n<p><b>WHY IT MATTERS<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Monday\u2019s global market rout also saw Japan\u2019s Nikkei plunge 12%, highlighting the interconnectedness of South Korea\u2019s economy with global events. The sharp declines in the KOSPI and KOSDAQ indices were primarily driven by U.S. recession fears and foreign investors\u2019 selling pressure.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The Financial Services Commission (FSC) and Financial Supervisory Service (FSS) held an emergency meeting on Monday afternoon and pledged thorough market monitoring and readiness to implement stabilization measures. FSC chairman Kim Byoung-hwan emphasized the need to analyze the stock market\u2019s sensitivity to external headwinds and improve its fundamentals to mitigate future shocks. Meanwhile, FSS Governor Lee Bok-hyun highlighted the financial sector\u2019s soundness, stable asset quality, capital adequacy and foreign exchange positions.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">However, the current turmoil may be just the beginning of a more prolonged period of volatility for South Korean markets. The South Korean won will likely continue to experience exchange rate volatility and capital outflows. Despite reassurances from the FSC and the FSS, the potential for further won depreciation may exacerbate the sell-off in South Korean assets. Moreover, structural vulnerabilities in the South Korean economy, such as worsening business sentiments, weak domestic consumption and rising household debts, indicate that South Korea has deeper concerns beyond the immediate focus on stock market stabilization.<\/span><\/p>\n<div class=\"content-tags\"><a href=\"https:\/\/koreapro.org\/tag\/business-economy\/\"><span class=\"tag\">Business &amp; Economy<\/span><\/a><\/div>","protected":false},"excerpt":{"rendered":"<p>The Korea Composite Stock Price Index (KOSPI) plunged a record 8.77%, or 234.64 points, to close at 2,441.55 on Monday, its lowest since Nov. 2023. The sharp decline, triggered by fears of a U.S. economic slowdown following disappointing employment data and weak big tech performance, prompted a 20-minute trading halt, the first since March 2020. [&hellip;]<\/p>\n","protected":false},"author":10407,"featured_media":2206050,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[30],"tags":[24],"class_list":["post-2206039","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-briefings","tag-business-economy"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v23.7 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>South Korea\u2019s stock market sinks as US economic woes spark global sell-off - KOREA PRO<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/koreapro.org\/2024\/08\/south-koreas-stock-market-sinks-as-us-economic-woes-spark-global-sell-off\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"South Korea\u2019s stock market sinks as US economic woes spark global sell-off - KOREA PRO\" \/>\n<meta property=\"og:description\" content=\"The Korea Composite Stock Price Index (KOSPI) plunged a record 8.77%, or 234.64 points, to close at 2,441.55 on Monday, its lowest since Nov. 2023. The sharp decline, triggered by fears of a U.S. economic slowdown following disappointing employment data and weak big tech performance, prompted a 20-minute trading halt, the first since March 2020. 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