South Korea's KOSPI Index expands gains to 1%

South Korea's KOSPI Index expands gains to 1%

South Korea's KOSPI Index has expanded its gains to 1% following the election of Lee Jae-myung as president. The victory of the progressive candidate has injected optimism into the country's financial markets, with the benchmark index showing a 12% increase this year, despite the political turmoil of the past six months.

Lee Jae-myung's decisive win, with over 49% of the votes cast, has ended the period of government chaos and brought a sense of stability to the $1.7 trillion economy. His strong mandate and pledges to revitalize the stock market and hold company boards to account have added momentum to official efforts to close the so-called Korea discount.

The new president's agenda of more aggressive fiscal spending and government-led growth marks a departure from the previous administration's tax cuts and deregulation push. This shift has been well-received by investors, with markets expected to continue their gains as Lee pushes for corporate governance reforms and shareholder value improvements.

Investors are particularly optimistic about Lee's pledge to end the Korea Discount and double the benchmark KOSPI index to 5,000 points from current levels. The new administration's focus on improving shareholder protections and holding company directors accountable is seen as a significant step towards boosting the country's market valuation and attracting more foreign investment.

While the political polarization in South Korea remains a concern, the election of Lee Jae-myung has brought a sense of relief to the country's financial markets. The resilience of Korean democracy, as evidenced by the high voter turnout, has also contributed to the positive sentiment.

References:
[1] https://www.csmonitor.com/World/Asia-Pacific/2025/0604/lee-south-korea-election-win?icid=rss
[2] https://www.tradingview.com/news/reuters.com,2025:newsml_L6N3S70DJ:0-election-win-heralds-upheaval-for-korea-inc/