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Kospi, Kosdaq rally on U.S. tariff reprieve

Published: 10 Apr. 2025, 10:33

The Korean benchmark Kospi soars on the morning of April 10 after U.S. President Donald Trump announces a 90-day halt on global tariffs, for the exception of China. [JOONGANG SUNDAY]

Korean stock markets surged on Thursday morning following an announcement from U.S. President Donald Trump that tariffs would be suspended for 90 days on countries other than China.

Both the Kospi and Kosdaq rallied sharply, with a buy-side sidecar triggered for the first time since last August.

The Korea Exchange activated a buy-side sidecar at 9:06 a.m. after the Kospi 200 futures soared more than 5 percent. A sidecar halts program buy orders on the Kospi for five minutes if futures jump more than 5 percent for at least one minute.

“This was due to the Kospi 200 futures [nearest-month contract] rising 17.55 points [5.76 percent] from the previous close of 304.65 to 322.20, and sustaining that gain for one minute," said the Korea Exchange.

This is the first time since Aug. 6, 2024, that a buy-side sidecar has been triggered. A sell-side sidecar was activated on Monday due to sharp declines.

The Kospi opened 101.43 points, or 4.42 percent, higher than the previous day at 2,395.13. The Kosdaq index surged 26.73 points, or 4.15 percent, to start trading at 670.12.

The Korean won also strengthened sharply against the U.S. dollar. After breaching 1,480 won the previous day, the won opened at 1,446 per dollar on Thursday, a gain of 38.1 won.

Market prices displayed at the Nasdaq MarketSite on April 7 in New York [AP/YONHAP]

Former U.S. President Donald Trump announced on Wednesday that reciprocal tariffs would be suspended for 90 days on all countries except China.

In a post on Truth Social, Trump wrote, “As of 12:01 a.m. today, more than 75 countries affected by reciprocal tariffs have not retaliated against the United States in any way, shape, or form. I have approved a 90-day suspension and authorized the immediate implementation of a dramatically reduced reciprocal tariff rate of 10 percent during this period.”

He added that tariffs on China would instead be raised to 125 percent.

The announcement triggered a massive rally in U.S. markets as well. On Wednesday, the Nasdaq rose 1,857.06 points, or 12.16 percent, to close at 17,124.97. The Dow Jones Industrial Average gained 2,962.86 points, or 7.87 percent, ending the session at 40,608.45. The S&P 500 climbed 474.13 points, or 9.52 percent, to close at 5,456.90.

The Nasdaq’s gain was the second-largest, single-day percentage increase since Jan. 3, 2001, when it surged 14.17 percent following the bursting of the tech bubble. The Dow recorded its sixth-largest gain ever, while the S&P 500 posted its third-largest daily increase, trailing only the Oct. 13 (11.58 percent) and Oct. 28 (10.79 percent) rallies of 2008 during the global financial crisis.

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.

BY CHO MUN-GYU [[email protected]]