Expect significant new tariffs on Chinese imports and moderate levies on goods from other nations , as President-elect Donald Trump rolls out his protectionist agenda. However, with his preference for chaotic policymaking and sudden shifts , there’s uncertainty on how soon these import taxes will actually hit. Dubbed “ Tariff Man ,” Trump aims to use tariffs both strategically and tactically . He’s mentioned taxing all Chinese goods up to 60% and potentially setting 10%-20% tariffs on imports globally , but details on these plans remain vague . Key players within Trump’s team are divided: Robert Lighthizer , a staunch tariff advocate, sees permanent duties as crucial to balance US trade , while others, like billionaires John Paulson and Scott Bessent , view tariffs as temporary leverage. Trump’s previous administration had mixed feelings, especially on national security-related trade limits , which he sometimes dismissed, favoring an “open for business” approach. High-profile busin
The South Korean won strengthened against the U.S. dollar on Monday, reflecting investor optimism following Federal Reserve Chair Jerome Powell’s comments, which solidified expectations of an interest rate cut by the U.S. central bank starting next month. The won gained 0.57% to trade at 1,320.5 per dollar on the onshore settlement platform.
Key Takeaways:
Won’s Strengthening: The South Korean won saw a notable increase in value, buoyed by Powell’s speech, which fueled hopes of an upcoming rate cut by the Federal Reserve. This rate cut is expected to ease monetary conditions globally, benefiting emerging market currencies like the won.
Stock Market Performance: Despite the positive currency movement, the benchmark KOSPI stock index remained largely unchanged, dipping slightly by 0.03% to 2,700.99. Market sentiment was mixed, with certain sectors experiencing gains while others saw declines.
Sector Movements:
- Tech Sector: Major tech stocks, including chipmakers Samsung Electronics and SK Hynix, declined by 1.54% and 1.94%, respectively.
- Automotive Sector: Hyundai Motor and Kia Corp also saw declines, falling 1.39% and 0.96%, respectively.
- Positive Performers: Conversely, LG Energy Solution, a battery maker, saw a significant rise of 4.18%, while tech companies Naver and Kakao also posted gains of 3.58% and 3.07%, respectively.
Foreign Investment and Market Sentiment: Foreign investors were net sellers on the day, offloading shares worth 179.6 billion won (approximately $136.02 million). This selling pressure, combined with mixed sector performances, kept the overall stock market relatively flat.
Bond Market Reactions: In the debt markets, September futures on three-year treasury bonds rose, indicating a slight increase in demand for safer assets. The yield on the most liquid three-year Korean treasury bond fell by 35.5 basis points to 2.884%, while the benchmark 10-year yield decreased by 3.6 basis points to 2.974%.
Year-to-Date Performance: The KOSPI index has risen by 1.72% so far this year, though it has lost 6.6% over the past 30 trading sessions. The won, despite today’s gains, has depreciated by 2.5% against the dollar year-to-date.
Overall, while Powell’s dovish comments have provided a boost to the won and some sectors within the South Korean market, the broader stock index remained flat amid mixed investor sentiment and ongoing global economic uncertainties.
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