FX.co ★ South Korea Shares Fall Amid Growth Worries

On Wednesday, the benchmark KOSPI index dropped by 0.3% to approximately 3,160, marking a second consecutive session of declines. This trend reflects growing investor unease about South Korea's economic prospects and sector-specific challenges. The Asian Development Bank's recent adjustment of South Korea's 2025 growth forecast to a mere 0.8% further exacerbated fears of waning economic momentum. This revision led to widespread market caution, notably impacting tech stocks such as Samsung Electronics (-1.5%), SK Hynix (-1.1%), LG Energy Solution (-0.8%), and Hanwha Aerospace (-1.4%), thereby pulling the index lower. Conversely, South Korean automakers experienced gains, driven by a newly enacted U.S.-Japan trade agreement that enforces a 15% tariff on Japanese auto exports to the United States. Consequently, Hyundai Motor surged by 4.6% and Kia Corporation by 5.6%. Additionally, consumer confidence improved, buoyed by the approval of a supplementary budget amounting to KRW 31.8 trillion, amidst domestic demand challenges and escalating trade negotiations with the U.S.