After experiencing a "night of horror," the South Korean stock market and the won-to-dollar exchange rate have shown fluctuations. According to reports from Yonhap News Agency, Korean regulatory agencies have stated that they are ready to deploy up to 10 trillion won in market stabilization funds at any moment to address market instability. As of 9:41 AM Beijing time on December 4th, the KOSPI was down nearly 2%, while the won's depreciation against the dollar narrowed, declining to 0.7%.
Regarding individual stocks, Samsung Electronics fell over 1%, and financial stocks were notably affected. Stock prices of Hana Financial Group and KB Financial Group both dropped by over 6%. The market's unease stems from the sudden state of emergency declared by the Korean government and the swift changes in the political landscape.
On the evening of December 3rd, President Yoon Suk-yeol delivered an emergency address from the presidential office in Yongsan, Seoul, announcing martial law measures aimed at eradicating the threat from "Northern forces" and preserving "constitutional order." However, the situation quickly escalated, with the Korean National Assembly and opposition parties issuing strong reactions. In the early hours of the 4th, the National Assembly convened an emergency meeting, passing a resolution to nullify the emergency martial law. The Speaker's office noted that with the resolution's passage, the martial law would become ineffective.
Earlier that day, Yoon Suk-yeol announced via televised broadcast the withdrawal of martial law troops and planned to convene a State Council meeting to formally lift the martial law. Additionally, the largest opposition party, the Democratic Party, held an emergency session at the National Assembly, calling for Yoon Suk-yeol's immediate resignation, arguing that his declaration of martial law was unconstitutional, lacking legal procedures. Should Yoon not resign voluntarily, the Democratic Party intends to advance impeachment proceedings.
Within the ruling party, there are also calls for Yoon Suk-yeol to step down from party leadership, further amplifying the current political turmoil. This sequence of events signifies an increase in uncertainty within Korean politics, with the stock market and exchange rates likely facing significant short-term volatility risks.
