South Korea's Finance Ministry says economy and stock market fundamentals remain sound

what happened

South Korea's Finance Ministry said on Friday that the fundamentals of the domestic economy and stock market are still solid, even though volatility has increased due to external factors. According to the ministry, U.S. Treasury yields, conditions in the artificial intelligence and semiconductor industries, and geopolitical tensions in the Middle East are feeding market swings and uncertainty.

The ministry pointed to projected economic growth of about 3% this year and a large current account surplus as evidence of the country's resilience. The government and financial regulators are watching markets closely and said they will act firmly against any activity that disrupts trading.

The benchmark Kospi was up 2.5% at 5691.20 in early trading, putting it on track to recover from a fall of more than 7% in Thursday's session.

why it matters

For investors, the statement signals that authorities intend to contain panic after a sharp selloff. Korean equities remain sensitive to U.S. Treasury yields and to the cyclical swings of the semiconductor sector, so external factors are likely to keep driving the index in the near term.

tags

instruments