HONG KONG — Asian markets retreated on Wednesday after political drama in South Korea added to regional uncertainty, although Seoul’s Kospi fell less than 2%.
US futures rose while oil prices were little changed.
South Korean President Yoon Suk Yeol suddenly declared martial law Tuesday evening local time, prompting troops to surround parliament. He accused pro-North Korean forces of plotting to overthrow one of the world’s most vibrant democracies. Martial law was revoked about six hours later.
On Wednesday, South Korea’s main opposition party summoned President Yoon resign immediately or face impeachment.
Yoon’s move initially caused the won to fall to a two-year low against the US dollar, with losses of up to 2%, the sharpest one-day decline since the market’s seismic reaction to Donald’s election victory Trump in 2016. The won made up for some of those losses on Wednesday. The dollar was trading at 1,414.43 won, down from Tuesday’s peak of 1,443.40.
South Korea’s Kospi lost 1.9% to 2,451.64. Shares of Samsung Electronics, the country’s largest company, fell 1.1%. Meanwhile, the country’s financial regulator said it was ready to put 10 trillion won ($7.07 billion) into a stock market stabilization fund at any time, Yonhap news agency reported.
Elsewhere in the region, China announced on Tuesday that this was the case ban exports to the United States of gallium, germanium, antimony and other important high-tech materials with potential military applications. Beijing took the measure after the US expanded his list of Chinese companies subject to export controls on equipment for making computer chips, software and high-bandwidth memory chips.
Hong Kong’s Hang Seng rose less than 0.1% to 19,752.59, while the Shanghai Composite fell 0.1% to 3,375.20.
The Japanese benchmark Nikkei 225 fell 0.4% to 39,077.04. The Australian S&The P/ASX 200 fell 0.5% to 8,454.10.
On Tuesday, U.S. stocks tiptoed to even more records, taking what has already been a banner year one step further.
The S&The P500 rose less than 0.1% to 6,049.88, hitting a record high for the 55th time this year. The Dow Jones Industrial Average fell 0.2% to 44,705.53, while the Nasdaq composite rose 0.4% to 19,480.91, hitting its own record high set a day earlier.
Government bond yields remained relatively stable after a report from the US showed employers advertised slightly more vacancies at the end of October than a month earlier. Continued strength there would boost optimism that the economy could stay out of a recession that many investors previously worried was inevitable.
The yield on the 10-year government bond rose to 4.23% from 4.20% at the end of Monday.
Yields have fluctuated since Election Day on concerns Trump favors lower tax rates And larger rates could encourage higher inflation. But traders are still confident Federal Reserve shall cut the key interest rate again at the next meeting in two weeks. According to data from CME Group, they’re betting on almost a three-in-four chance.
Lower rates can boost the economy, but they also tend to fuel inflation.
One report this week that could guide the Fed’s next move is Friday’s jobs reportwhich will show how many workers American employers hired and fired in November. It can be difficult to analyze given the amount of storms and strikes that skewed October’s numbers.
Based on trading in the options market, Friday’s jobs report appears to be the biggest potential market move until the Fed announces its next interest rate decision on Dec. 18, according to strategists at Barclays Capital.
In energy trading, benchmark U.S. crude lost 5 cents to $69.99 a barrel. Brent crude, the international standard, added 7 cents to $73.69 a barrel.
In currency trading, the US dollar rose from 149.59 yen to 149.75 Japanese yen. The euro cost $1.0495, up from $1.0510.
___
AP Business Writer Stan Choe contributed.