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A screen displays the Kospi index and the exchange rate between the South Korean won and the US dollar inside a trading room at Hana Bank in Seoul, South Korea, Monday, Dec. 16, 2024.
Seong Joon Cho | Bloomberg | fake images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Do you like what you see? You can subscribe here.
What you need to know today
All eyes on US jobs report
The US nonfarm payrolls report for December will be released later on Friday. Economists hope it will show an increase of 155,000 jobsup from 227,000 in November, and the unemployment rate will remain unchanged at 4.2%. Analysts of Goldman Sachs and citi groupHowever, they believe both figures will be worse than consensus forecasts.
US markets dark, European markets close higher
US markets were closed on Thursday in honor of former US President Jimmy Carter, who He died at the end of December at the age of 100.. European regional Stoxx 600 The index added 0.42% after starting the day in negative territory. Denmark’s Moller-Maersk fell 5.8% amid a sell-off in shipping shares after a tentative labor agreement It was jammed by American dock workers.
Fed governor thinks December cut should be ‘final step’
US Federal Reserve Governor Michelle Bowman said the Fed Interest rate cut in December should be their “last step in the policy recalibration phase.” That suggests that Bowman, who is a voting member of the Federal Open Market Committee, could oppose new cuts this year. Other Federal Reserve officials who spoke this week were more optimistic about lowering rates.
Ubisoft explores ‘strategic and capitalist options’
French video game publisher. Ubisoft said Thursday that it has appointed “lead advisors” to review options “to extract the best value for stakeholders.” In October it was reported that the Guillemot family, founders of Ubisoft, and Tencent were considering a company acquisition. With Ubisoft shares at 10-year lows, the company faces questions about his future.
(PRO) Employment Sweet Spot Report
The US economy is in a delicate position between growth and inflation. The jobs report, released Friday, demonstrates the difficulty of this balancing act. Too much heat and Treasury yields could rise; too cold and fears of an economic slowdown could hold back stocks, Goldman Sachs said. But he S&P 500 could be recovered if the report reaches the just the right range.
The final result
South Korea can’t catch a break. In the last month, the country was placed under martial law, its acting president (and deputy) was impeached, it is in its second acting president (so far), and suffered a tragic plane crash.
How have these events affected the Korean market?
According to the Kospi index: not much. The index, which tracks all common stocks listed on the Korea Stock Exchange, is now higher than it was on Dec. 3, when indicted President Yoon Suk Yeol declared martial law.
Its resilience dates back to Korea’s political history and the Bank of Korea’s quick (and perhaps fortuitous) actions.
Yoon and Han Duck-soo are just the last two presidential figures to be impeached in Korean history. Before them, Roh Moo-hyun was indicted in 2004 (although the court overturned it), while Park Geun-hye was indicted in 2016 and removed from office the following year.
“Presidential impeachments are unprecedented in Korea, and the country’s stocks at least ultimately performed well during the most recent one in 2016/2017,” said Thomas Mathews, head of Asia Pacific markets at Capital Economics. . saying.
Uncertainties caused by Korea’s last two impeachments “have eased in three to six months,” said Soohyung Lee, a member of the Bank of Korea’s Monetary Policy Board. he told CNBC on January 2, so “it is possible that political turmoil will not affect the country’s economy as much.”
The Bank of Korea’s actions also appeared to calm markets.
On the day Yoon lifted martial law, the BOK announced Emergency measures to calm the markets. and prevent volatility. Likewise, a Surprise 25 basis point rate cut adopted by the BOK at its November meeting, enacted before Yoon declared martial law in December, could have cushioned the blow.
Domestic factors may not be the biggest threat to the Korean economy and markets in the coming year. He downside risks The problems posed by US President-elect Donald Trump’s tariffs are more worrying, especially for an export-driven country like Korea, Lee said.
Korea’s recent troubles demonstrate that when one branch of government fails, other institutions can still prop up a country and its economy, but the governments of others are much more difficult to deal with.
— CNBC’s Lim Hui Jie and Lee Ying Shan contributed to this report.
