South Korea's KOSPI rises nearly 2%.

South Korea's KOSPI rises nearly 2%.

The South Korean KOSPI index rose nearly 2% on Wednesday, marking its highest level since August 2024. The surge was driven by a combination of factors, including the election of opposition party leader Lee Jae-myung as the new president and a broader tech rally that lifted global markets [1].

Lee Jae-myung's victory in the snap presidential election brought a wave of optimism to South Korean markets. The Kospi index, the benchmark for South Korean equities, gained 2.05% to 2,754.42, its highest level since August 2024. The small-cap Kosdaq index also saw a significant increase, rising 1.4% [2].

The election result is expected to have a positive impact on the Korean stock market. John Cho, Korea equity portfolio manager at J.P. Morgan Asset Management, noted that Lee's pledge to amend the commercial law to protect minority shareholders' interests could encourage boards to make more value-accretive decisions [2]. Additionally, the new government is expected to adopt aggressive fiscal stimulus measures to revive the domestic economy while handling international trade matters pragmatically [2].

The tech sector played a significant role in the global rally that spilled over into South Korean markets. Nvidia, a key player in the artificial intelligence space, saw its shares advance nearly 3%, extending Monday's gains and pushing its market cap past Microsoft's for the first time since January. Other chip companies like Broadcom and Micron Technology also saw significant gains, rising more than 3% and 4%, respectively [1].

The broader Asian markets also saw gains, with Japan's Nikkei 225 climbing 0.88% and the CSI 300 index in China moving up 0.43% [1]. Meanwhile, the South Korean won strengthened by 0.43% against the U.S. dollar following the election win, reflecting investor confidence in the country's economic prospects [2].

Overall, the South Korean market's performance on Wednesday was a positive indicator for the broader Asian region, driven by a mix of domestic political developments and global tech trends.

References:
[1] https://www.nbcnewyork.com/news/business/money-report/asia-pacific-markets-set-to-open-mostly-higher-after-tech-rally-lifts-wall-street/6288461/?os=..&ref=app
[2] https://www.nbcnewyork.com/news/business/money-report/south-korean-won-strengthens-following-opposition-leader-s-election-win/6288462/?os=..&ref=app