Credit: Public domain.
After a wobbly 2023, the world economy is seeing a strong start to 2024, with S&P 500 reaching new heights. But the good news has yet to reach the South Korean stock market. The KOSPI index has fallen by nearly 7% since the start of the year, losing money every single day in 2024 for the first two and a half weeks of January.
International investors led the sell-off of Korean stocks, selling KRW 1.34t (USD 1b) worth of shares over the past three weeks. Analysts say the sell-off has been motivated by weak earnings reports from leading Korean firms such as Samsung Electronics 삼성전자, the continued softening of China’s economy, and increased geopolitical risks around North Korea. As international investors exited, the KRW-USD exchange rate soared to over KRW 1.3k to USD 1, placing significant stress on South Korean corporations that import materials.
