On the 2nd, the Korea Composite Stock Price Index (KOSPI) retreated to the 3070 level. President Donald Trump of the United States mentioned, "There will be no mutual tariff exemption," which fueled a risk-averse sentiment in the market. Alongside this, profit-taking sales emerged, leading to a decline in the stock prices of shipbuilding and nuclear power stocks that had driven the KOSPI index's rise.
On this day, the KOSPI index closed at 3075.06, down 14.59 points (0.47%) from the previous trading day. The index started at 3083.82, down 5.83 points (0.19%), and expanded its losses. While it partially reduced its losses in the afternoon, it had plummeted to as low as 3032.47 in the morning. The intraday high for the day was 3090.61.
Up until the previous day, the KOSPI had risen for two consecutive days, finishing at 3089.65. During intraday trading, it rose to 3133.52, surpassing the record high from the 25th of last month (3129.09) within four trading days. The influence of institutional buying, along with foreign investors returning to "buy Korea" after five transaction days, was significant.
However, on this day, foreign investors shifted to "sell Korea." They net sold 414.4 billion won worth of shares in the KOSPI market and also net sold 204.3 billion won worth of KOSPI 200 futures. While individual investors net bought 391.5 billion won, and institutions also net bought 55.2 billion won, it was insufficient to prevent the index from falling.
The renewed uncertainty over tariffs stemming from Trump has been analyzed as causing foreign investors to "sell Korea," leading to a decline in the KOSPI index. President Donald Trump reiterated that he has no intention of extending the mutual tariff exemption deadline that ends on the 8th (local time), which further fueled risk aversion.
On the 1st (local time), during a press briefing aboard Air Force One, President Trump answered "No" when asked whether he plans to extend the tariff exemptions. He added, "I will write letters regarding mutual tariffs to each country." He also mentioned the possibility of raising tariffs for Japan, which has fallen into a stalemate in negotiations.
The Trump administration announced differentiated mutual tariffs with Korea and 55 other countries, including the European Union (EU), on April 2 and implemented them at 0:01 on April 9, later deciding to exempt it for 90 days, excluding China, just 13 hours later. Subsequently, trade negotiations have been ongoing with various countries.
The decline in tech stocks on the New York Stock Exchange overnight also had a negative impact on the domestic stock market. As investors shifted their sentiment from tech shares to blue-chip stocks, shares of Nvidia, a leading artificial intelligence (AI) company, fell nearly 3%, and shares of Tesla dropped over 5% due to worsening conflicts between Trump and Elon Musk.
Amid increased short-term volatility, the stock prices of recently surging stocks reversed and fell. Specifically, the stock price of SK hynix, which accounted for 16.6% of the KOSPI's market capitalization increase in the first half of the year, dropped over 2% in line with the downturn in Nvidia's stock price in the U.S.
The shipbuilding, defense, nuclear power, finance, holding, and internet sectors also closed lower on this day. They had been identified as leading stocks driving the KOSPI index up, but massive profit-taking sales emerged. Notably, shares of Hanwha Aerospace fell over 2%, and shares of Doosan Enerbility also dropped about 1.4%.
In contrast, LG Energy Solution started weak due to the sharp drop in Tesla's stock price overnight, but reversed course and closed up 1.68% at 302,500 won per share compared to the previous trading day. In addition, shares of Hyundai Motor and Kia closed up in the 1% range, while Celltrion's stock price rose over 5%, also finishing higher.
Shares of HD Hyundai Construction Equipment and HD Hyundai Infracore also showed a joint increase. The news of plans to merge HD Hyundai Construction Equipment with HD Hyundai Infracore served as positive news. Additionally, shares of Aekyung Chemical, which is pursuing the commercialization of sodium-ion battery-based energy storage systems (ESS), also surged over 16%.
Lee Kyung-min, a researcher at Daishin Securities, noted, "Stocks that had recently surged have reversed to decline, while there has been a differentiated rebound in sectors and stocks that had been relatively neglected and experienced poor stock prices. He further commented, "We are entering a phase of short-term profit digestion and cooldown, so it is time to respond slowly with some temporal leeway."
The KOSDAQ index also experienced a slight decline. On this day, the KOSDAQ index closed at 782.17, down 1.50 points (0.19%) compared to the previous session. The index started at 784.73, up 1.06 points (0.14%), but reversed to decline during intraday trading. Like in the KOSPI market, foreign investors led the index decline by net selling 204.5 billion won.
Most of the top stocks by market capitalization in the KOSDAQ market closed higher. This was due to inflows into sectors such as pharmaceuticals, biotech, and secondary battery stocks, which had been relatively neglected despite the recent bull market. On this day, shares of Alteogen, the top stock in the KOSDAQ market, rose over 5%, while shares of Ecopro and Ecopro BM also increased.
Lee Jae-won, a researcher at Shinhan Investment Corp., indicated, "Until the announcement of the tariff negotiation plan, a sense of caution is expected to persist, similar to early April. The U.S. employment report will be released on the 3rd, and Samsung Electronics is scheduled to announce preliminary results on the 8th, so the market's attention will shift to earnings and interest rate reduction afterward."
Meanwhile, in the Seoul foreign exchange market, the exchange rate of the won against the U.S. dollar closed at 1353.30 won, up 0.50 won (0.04%) from the previous trading day. Due to the impact of tariff uncertainties, it opened at 1355.0 won, down 0.9 won (0.09%) from the previous day, and remained flat.