South Korea’s stock and currency markets are reeling amid a wave of “Trump panic,” as former President Donald Trump’s re-election fuels fresh concerns over his “America First” agenda. Rising fears have sparked worries about potential impacts on South Korea’s export-driven economy.
On Nov. 13, the benchmark Korea Composite Stock Price Index (KOSPI) dropped 2.64%, closing at 2,417.08, its lowest level since last November. This marks KOSPI’s fourth consecutive decline, with losses intensifying from a 0.52% dip on Nov. 6 to 1.15% on Nov. 11, and now over 2%—a sign of deepening investor unease. “This drastic fall, absent any significant negative developments, reflects a panic response rooted in fears over Trump’s policies,” commented Noh Geun-chang, head of a research center at Hyundai Motor Securities.
KOSPI’s market capitalization slipped below the 2,000 trillion won threshold, reaching 1,971 trillion won (about $1.40 trillion)—the first time since the “Black Monday” downturn on Aug. 5. The tech-heavy Kosdaq also plunged, down 2.94% to close at 689.65, marking its lowest point in two months since Jan. 6 last year.
Foreign investors have been the main force behind the sell-off in Korean stocks, with growing apprehensions over Trump’s potential policy shifts. Net foreign sales amounted to 713.4 billion won in the KOSPI market, with Samsung Electronics seeing heavy outflows for the 11th straight trading session, totaling 2.692 trillion won ($1.91 billion) during that span.
In light of the sharp market decline, the South Korean government is formulating countermeasures. An official from the presidential office indicated that “the matter will be addressed at the economic ministerial meeting on Nov. 14, with financial authorities set to announce relevant measures.”
South Korea’s economy, with exports comprising over 40% of GDP, is acutely susceptible to external pressures. Key exports to the U.S. center on automobiles, making up 35% of shipments, while semiconductor exports to China account for 50% of that trade. Concerns are mounting that Trump’s protectionist stance on the U.S. auto industry could curtail South Korean automotive exports, while a hardline policy on China could dampen the country’s semiconductor sector. “The South Korean economy, driven by exports, could bear the impact of Trump’s economic policies more severely than other nations, and this is already reflected in stock and currency values,” noted Kim Jung-sik, an honorary professor of economics at Yonsei University.
Globally, markets reacted differently to the election outcome. According to the Korea Exchange, Turkey’s stock market led post-election gains with a 7.06% rise from Nov. 5–12, followed by Russia (5.47%), the U.S. Nasdaq (4.57%), and Argentina (4.18%). In contrast, the secondary Korea Securities Dealers Automated Quotation (KOSDAQ) market posted the steepest decline at -5.49%, followed by KOSPI at -3.66%. Among major markets, South Africa was next in line, with a 3.02% drop.
Samsung Electronics, South Korea’s largest publicly traded company, suffered a steep 4.53% decline, closing at 50,600 won, inching closer to the “40,000-won range” last touched in June 2020, nearly four years ago.
