South Korean stocks surged 2% leading gains across Asia-Pacific markets on Wednesday, following a notable victory for the opposition party leader in the presidential election. The positive market movement came as Wall Street saw a boost from a tech rally driven by chipmaker Nvidia. The South Korean stock index leaped 2.66% to close the day at 2,770.84, while the smaller Kosdaq advanced by 1.34% to 750.21.
John Cho, Korea equity portfolio manager at J.P. Morgan Asset Management, highlighted that the new president’s election pledge aims to enhance the value of the Korean stock market. His proposed changes to commercial law are expected to provide better protection for minority shareholders and promote more value-accretive decisions by boards. Looking ahead, Cho expects the incoming government to implement aggressive fiscal stimulus measures to jump-start the domestic economy and manage international trade matters pragmatically.
He anticipates a rebound in the South Korean economy in the latter half of 2024 and early 2025, driven by globally competitive industries like high bandwidth memory for AI, health and beauty sectors, and heavy industries. Elsewhere in the region, Chinese and Hong Kong markets experienced modest gains after U.S. President Donald Trump discussed trade with Chinese President Xi Jinping. Mainland China’s stock index rose 0.43% to close at 3,868.74, while Hong Kong’s index climbed 0.6% to 23,654.03.
In Japan, the benchmark index increased by 0.8% to settle at 37,747.45, with the broader Topix index rising 0.51% to 2,785.13.
Stocks surge after election victory
Australia’s key index ended the day up 0.89% at 8,541.80.
Meanwhile, India’s BSE Sensex advanced 0.29% by afternoon trading, buoyed by Wall Street’s tech rally and a promising U.S. jobs report. The broader indices followed suit with India’s Nifty gaining 0.81% to settle at 19,398.96. Bullion prices saw a modest increase, advancing 0.24% to $3,359.87 per ounce, driven by ongoing trade tensions which bolstered the metal’s appeal as a safe-haven asset.
In other sectors, shares of Asia-Pacific steelmakers rose, prompted by a new U.S. tariff policy that doubled rates on most imported steel and aluminum. This increased protectionist measure led to a rise in Chinese, Japanese, and South Korean steel stocks. Technology stocks also demonstrated significant gains, with South Korea’s SK Hynix surging 4.82% and Samsung Electronics gaining 1.76%.
In Taiwan, major tech firms, including Foxconn, saw their shares climb 4.21% and 2.97% respectively. South Korea’s currency, the won, appreciated by 0.43% against the U.S. dollar, coinciding with a decline in the dollar’s value amidst uncertainties about President Trump’s tariff plans. Overall, the positive movements across Asia-Pacific markets spell optimism as regional economies and industries react to political developments and international trade dynamics.
