Seoul shares open higher amid multiple US trade deals
The benchmark Korea Composite Stock Price Index gained 12.1 points, or 0.38 percent, to 3,182.04 in the first 15 minutes of trading.
Overnight, Wall Street closed mixed amid a slide in tech shares and expectations brewed by US Treasury Secretary Scott Bessent's remarks that he will meet with his Chinese counterpart in Stockholm next week for trade talks.
The Dow Jones Industrial Average rose 0.4 percent, and the S&P 500 edged up 0.06 percent.
The tech-heavy Nasdaq composite, however, shed 0.39 percent as major semiconductor shares lost ground following reports the ambitious artificial intelligence project "Stargate," led by OpenAI and SoftBank, has been facing internal disagreements.
Meanwhile, US President Donald Trump's announcement over trade deals with Japan and the Philippines boosted hopes for eased trade uncertainties.
In Seoul, tech giant Samsung Electronics lost 0.3 percent, and its chipmaking rival SK hynix went down 0.93 percent.
Defense giant Hanwha Aerospace dropped 0.65 percent, and leading shipbuilder HD Hyundai Heavy declined 0.84 percent.
On the other hand, leading battery maker LG Energy Solution climbed 1.05 percent, and major biotech firm Samsung Biologics advanced 2.02 percent.
Automakers were strong, with Hyundai Motor soaring 4.12 percent and its sister Kia jumping 3.78 percent.
Steel giant Posco Holdings also surged 4.95 percent.
The local currency was trading at 1,380.7 won against the US dollar at 9:15 a.m., up 7.1 won from the previous session. (Yonhap)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Korea Herald
12 minutes ago
- Korea Herald
Samsung to produce Tesla's next-gen AI chips in $16.5b foundry breakthrough
Record deal signals trust in Samsung's 2nm tech amid race with TSMC, Chinese chipmakers Samsung Electronics will be producing Tesla's next-generation artificial intelligence chip, known as AI6, under a record-breaking $16.5 billion contract deal. Tesla CEO Elon Musk said in a social media post Monday that Samsung's chip manufacturing facility in Texas will be dedicated to producing his company's chips. His post on X came shortly after Samsung announced a foundry deal, disclosing only that the customer is a 'global conglomerate.' 'Samsung's giant new Texas fab will be dedicated to making Tesla's next-generation AI6 chip. The strategic importance of this is hard to overstate,' Musk wrote. 'Samsung currently makes AI4. TSMC will make AI5, which just finished design, initially in Taiwan and then in Arizona,' he added. In a regulatory filing earlier in the day, the chipmaker reported that it had secured a foundry deal worth $16.5 billion — accounting for 7.6 percent of its projected 2024 sales — running through the end of 2033. Samsung did not disclose the customer's identity, citing business confidentiality. The contract marks the largest single-client deal for Samsung's semiconductor division. Musk also stated in a separate post, 'Samsung agreed to allow Tesla to assist in maximizing manufacturing efficiency,' suggesting further collaboration as the project moves forward. 'This is a critical point, as I will walk the line personally to accelerate the pace of progress. And the fab is conveniently located not far from my house.' Samsung is currently constructing a chip manufacturing plant in Taylor, Texas, about an hour's drive from Austin, where Musk lives. The chip giant reportedly revised its plans to accelerate equipment installation at the Taylor fab, aiming to start mass production in the second half of next year. The deal is expected to provide a much-needed boost for Samsung's foundry business, which has been logging multi-trillion-won yearly losses, factoring in to affect the tech giant's overall performance. In an earnings guidance for the April-June period this year, Samsung reported an operating profit of 4.6 trillion won ($3.34 billion), nearly halved from a year earlier. Analysts estimate the company's Device Solutions division, which oversees its semiconductor business, generated less than 1 trillion won in operating profit, with the combined foundry and logic chip business predicted to post losses of around 2 trillion won. Amid continuous losses from the foundry unit, speculation of a potential spin-off has surfaced in the market. Samsung Electronics Chairman Lee Jae-yong, however, dismissed the rumors, saying he has 'no interest in spinning off the division.' Given the nature of the foundry business, where securing clients directly translates into revenue, the Tesla deal marks a significant step for Samsung. The company has been under pressure as the gap with market leader TSMC continues to widen and competition from Chinese players intensifies. According to market tracker TrendForce, Samsung held a 7.7 percent share of the global foundry market in the first quarter, far behind TSMC's 67.6 percent. China's SMIC closely followed with 6 percent. Experts say the large-scale deal shows growing trust in Samsung's advanced process technology and could lead to additional orders. 'The latest contract is significant as the chip giant has been struggling with heavy losses in the foundry business. Winning an order from a major company like Tesla suggests strong trust in Samsung's technology,' Lee Jong-hwan, a system semiconductor engineering professor at Sangmyung University. 'This could pave the way for other big tech companies to place orders as well.' As the deal is likely based on Samsung's next-generation 2-nanometer process nodes currently under development, the utmost priority for Samsung will be securing production yield, Lee explained. While Samsung was quick to introduce a 3-nanometer process in 2022, it faced yield issues and struggled to commercialize the technology. 'Even if the factory is set up and production starts next year, the business could be unprofitable if input costs remain high due to low yields.' The AI chips Musk mentioned are Tesla's Full Self-Driving chips. The AI6 chip Samsung will supply is reportedly adopting a 2-nanometer process, while the AI5 chip that TSMC is making adopts 3nm technology.
Korea Herald
4 hours ago
- Korea Herald
S. Korea proposes major shipbuilding investment in US ahead of tariff negotiation deadline
South Korea has proposed a multibillion-dollar shipbuilding investment package in the United States as part of ongoing negotiations to avert steep US tariffs as the Aug. 1 deadline for such a deal nears, government sources said Monday, noting the proposal appears to have been well received. According to the multiple sources, Industry Minister Kim Jung-kwan held talks with US Commerce Secretary Howard Lutnick on Friday in New York, during which he presented the proposal, dubbed "Make American Shipbuilding Great Again". The MASGA project, whose name is inspired by US President Donald Trump's slogan "Make America Great Again", involves large-scale investments by South Korean private shipbuilders in the US The package includes not only capital investment but also financial support, such as loans and guarantees backed by Korean institutions. Public financial institutions, such as the state-run Export-Import Bank of Korea, are being considered as potential participants in providing financial support for the MASGA initiative, the source said. Lutnick, who is seen as a key decision-maker in the bilateral tariff negotiations, reportedly responded positively to the proposal and expressed satisfaction with Seoul's offer. As part of the ongoing talks, Finance Minister Koo Yun-cheol is expected to visit the US later this week and is likely to meet with US Treasury Secretary Scott Bessent on Thursday. Seoul aims to finalize a trade agreement with Washington before the Aug. 1 deadline to reduce the 25 percent reciprocal tariff and sector-specific duties imposed on South Korean goods under the Trump administration. The reciprocal tariffs were initially implemented April 9 but were immediately suspended by President Trump for 90 days to allow for negotiations. The suspension has since been extended, but Washington indicated plans to resume enforcement starting Aug. 1 unless a deal is reached. (Yonhap)
Korea Herald
4 hours ago
- Korea Herald
US, EU reach 15% tariff deal
TURNBERRY, Scotland (Reuters) -- The US struck a framework trade agreement with the European Union on Sunday, imposing a 15 percent import tariff on most EU goods -- half the threatened rate -- and averting a bigger trade war between the two allies that account for almost a third of global trade. US President Donald Trump and European Commission President Ursula von der Leyen announced the deal at Trump's luxury golf course in western Scotland after an hour-long meeting that pushed the hard-fought deal over the line, following months of negotiations. "I think this is the biggest deal ever made," Trump told reporters, lauding EU plans to invest some $600 billion in the United States and dramatically increase its purchases of US energy and military equipment. Trump said the deal, which tops a $550 billion deal signed with Japan last week, would expand ties between the trans-Atlantic powers after years of what he called unfair treatment of US exporters. Von der Leyen, describing Trump as a tough negotiator, said the 15 percent tariff applied "across the board,' later telling reporters it was "the best we could get." "We have a trade deal between the two largest economies in the world, and it's a big deal. It's a huge deal. It will bring stability. It will bring predictability," she said. The agreement mirrors key parts of the framework accord reached by the US with Japan, but like that deal, it leaves many questions open, including tariff rates on spirits, a highly charged topic for many on both sides of the Atlantic. The deal, which Trump said calls for $750 billion of EU purchases of US energy in coming years and "hundreds of billions of dollars" of arms purchases, likely spells good news for a host of EU companies, including Airbus, Mercedes-Benz and Novo Nordisk, if all the details hold. German Chancellor Friedrich Merz welcomed the deal, saying it averted a trade conflict that would have hit Germany's export-driven economy and its large auto sector hard. German carmakers, VW, Mercedes and BMW were some of the hardest hit by the 27.5 percent US tariff on car and parts imports now in place. The baseline 15 percent tariff will still be seen by many in Europe as too high, compared with Europe's initial hopes to secure a zero-for-zero tariff deal. Bernd Lange, the German Social Democrat who heads the European Parliament's trade committee, said the tariffs were imbalanced and the hefty EU investment earmarked for the US would likely come at the bloc's own expense. Trump retains the ability to increase the tariffs in the future if European countries do not live up to their investment commitments, a senior US administration official told reporters on Sunday evening. The euro rose around 0.2 percent against the dollar, sterling and yen within an hour of the deal's being announced. Carsten Nickel, deputy director of research at Teneo, said Sunday's accord was "merely a high-level, political agreement" that could not replace a carefully hammered out trade deal: "This, in turn, creates the risk of different interpretations along the way, as seen immediately after the conclusion of the US-Japan deal." While the tariff applies to most goods, including semiconductors and pharmaceuticals, there are exceptions. The US will keep in place a 50 percent tariff on steel and aluminum. Von der Leyen suggested the tariff could be replaced with a quota system; a senior administration official said EU leaders had asked that the two sides continue to talk about the issue. Von der Leyen said there would be no tariffs from either side on aircraft and aircraft parts, certain chemicals, certain generic drugs, semiconductor equipment, some agricultural products, natural resources and critical raw materials. "We will keep working to add more products to this list," von der Leyen said, adding that spirits were still under discussion. A US official said the tariff rate on commercial aircraft would remain at zero for now, and the parties would decide together what to do after a US review is completed, adding there is a "reasonably good chance" they could agree to a lower tariff than 15 percent. No timing was given for when that probe would be completed. The deal will be sold as a triumph for Trump, who is seeking to reorder the global economy and reduce decades-old US trade deficits, and has already reached similar framework accords with Britain, Japan, Indonesia and Vietnam, although his administration has not hit its goal of "90 deals in 90 days." US officials said the EU had agreed to lower non-tariff barriers for automobiles and some agricultural products, though EU officials suggested the details of those standards were still under discussion. "Remember, their economy is $20 trillion ... they are five times bigger than Japan," a senior US official told reporters during a briefing. "So the opportunity of opening their market is enormous for our farmers, our fishermen, our ranchers, all our industrial products, all our businesses." Trump has periodically railed against the EU, saying it was "formed to screw the United States" on trade. He has fumed for years about the US merchandise trade deficit with the EU, which in 2024 reached $235 billion, according to US Census Bureau data.
