South Korean Stocks Set for One-Year Low on Trump Policy Concern

(Bloomberg) - South Korean shares were headed for their lowest in a year, as foreign investors sold major exporters including Samsung Electronics Co. that are vulnerable to Donald Trump's protectionist trade policy.

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The benchmark Kospi index fell as much as 2.3% Wednesday, making itself the worst performer in Asia amid a regional selloff caused by worries about the US President-elect's proposed tariffs and policies that may keep inflation elevated.

Chipmaker Samsung Electronics and steel producer Posco Holdings Inc. were among the biggest contributors to Kospi's losses.

The selloff in Korea is the latest reminder of the more pronounced impact of Trump's isolationist vision for America, especially the prospect of higher trade barriers, on economies that have thrived on globalization. The trade-related worries add pressure to a market already reeling from concerns about Samsung, the stock benchmark's biggest-weighted member, given its inability to gain traction in the AI memory sector.

"Foreigners are dumping both KRW and export companies, notably Samsung," said Jung In Yun, chief executive at Fibonacci Asset Management Global Pte. "Reserve cash for now so that we can re-enter this market after the Trump effect wanes. But today we sell."

Since the Kospi's July peak, Samsung has tumbled more than 42%. The tech-heavy Kosdaq index slid to its lowest since January 2023 at one point.

Meanwhile, Korea Zinc Co.'s decision to scrap a $1.8 billion share sale just two weeks after the company surprised investors with the plan also soured sentiment.

-With assistance from Abhishek Vishnoi.

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