FX.co ★ South Korean Shares Dip as Auto Stocks Drag

The KOSPI benchmark index experienced a 0.5% decline on Wednesday, settling around 2,631 points. This drop comes after a robust 1.1% gain in the previous session, as automotive stocks faced substantial pressure. Investor confidence waned following U.S. President Trump's announcement of a 25% tariff on all imported vehicles, effective next week. This development could pose a significant challenge to South Korea's automotive sector, as the U.S. accounted for nearly half of South Korea’s total car exports last year. Furthermore, Trump plans to introduce additional reciprocal tariffs on April 2. Among the automakers, Hyundai Motor saw a 2.6% decrease, while its affiliate, Kia Corp, fell by 1.8%. This occurred despite the Hyundai Group's recent U.S. investment initiative. Other sectors also faced notable declines, including chip and steel manufacturers, coupled with SK Hynix dropping 2.3%, Posco Holdings losing 2.1%, Korea Zinc decreasing by 1.9%, and Hyundai Steel falling by 3.1%. Hyundai Steel is a key supplier of steel plates utilized in vehicle and ship manufacturing.