It's time now for an in-depth look at the global markets this afternoon, and for that I'm joined on the line by Mr. Daniel Yoo, global strategist at Kiwoom Securities.
Mr. Yoo, thank you for coming on today.
All three main indexes on Wall Street were up on Wednesday, apparently overcoming fears of a recession. Korean stocks, though, moving in the opposite direction. What's the story today?
Jackson Hall Conference to start. Kansas City economic policy symposium one of the oldest conferences in the world. Economists, financial market participants, US government representatives, and central bank officials from around the world will attend.
Unlike in the past, major central banks are expected to voice more intensely. Especially in the US, Concerns are rising and concerns over economic slowdown in Europe and China continues.
Meanwhile, Powell's Fed chairman will make his first speech after the July rate cut at 10 am on the 23rd local time. Many things have happened since the 31st press conference. Trump announced tariffs against China in particular, Short- and long-term interest rates have been inverted.
If Powell's Jackson Hall conference speech shows no indication of an additional rate cut, it could creat huge financial market volatility.
US market showed sharp rise yesterday, where Dow +0.93%, SP +0.82%, and Nasdaq +0.9%, and Eurpoe rose sharply as well due to optimizm of huge boosting measures by Eureopean government. However, most of asian market showed decline. Kospi down by 0.45%, Nikkei down 0.14%, Shanghai -0.25%, Shenzhen -0.21%
Meanwhile, it seems like the Korean won is finding some stability against the U.S. dollar after it plunged last month. The won is still under pressure, though, because of all the uncertainty on trade and so much else. Where do you see the currency going?
European government's aggressive boosting measures using monetary and fiscal policy. Reasons for weaker Euro.
China also lowered interest rate by 0.1%, also reaons for weaker RMB
However, USD is still strong at over 98.
You need to see aggressive lowering of interest rate by US for Won to go lower to below 1200 level. 1200 is becoming resisitance rather these days.
Key Question is all about monetary policy - Will BoK lower again. KRW will stablize in the future.
Now, South Korea and Israel have signed a free trade agreement, now three years after they started negotiations. What's in this deal and what effect do you think it'll have?
The Ministry of Trade, Industry and Energy says the free trade agreement between South Korea and Israel has been finalized after three years of negotiations.
As a result of the negotiations, Korea will eliminate tariffs on 99.9% of Israel's imports and Israel will eliminate tariffs on 100% of Korean imports.
The Ministry of Industry said, "Korea is the first Asian country to enter into a free trade agreement with Israel." Synergy will be between Israel's high tech technology and Korea's strong maufacturing capabilities.
Korea's trade with Israel exceeded $ 2.7 billion last year, with Korea's major exports being automobiles and Petrochemicals, plastics, and Israel's major export to Korea being semiconductor manufacturing equipment and electronic applications.
Among very bad news flow on trade, this is a good news for Korea.
Alright, Mr. Yoo. That's where we'll have to leave it today.
Thank you for coming on as always.