[Featured Stocks] Wire and Cable Stocks Rally... Expected 'Reflected Benefits' from US Moves to Restrict Chinese Products

On the 25th, stocks of companies related to wires and cables showed a significant surge in the stock market. The U.S. Federal Communications Commission (FCC) is moving to restrict the use of Chinese-made cables by revising submarine cable regulations, raising expectations that Korean wire companies will gain a windfall benefit.

Daehan Electric Wire is producing ultra-high voltage submarine cables.

Among wire stocks, Gaon Cable showed the largest increase. As of 3:10 PM, Gaon Cable was trading at 44,300 KRW, up 16.73% from the previous day's closing price. It remained flat during the morning session but surged sharply around 1 PM after lunch.

LS Electric also recorded a 14.58% rise, trading at 150,800 KRW. It climbed to the 140,000 KRW level during the morning session and broke through the 150,000 KRW mark in the afternoon, showing a steep upward trend.

Other companies such as Daehan Cable (6.51%) and HD Hyundai Electric (6.75%) also showed relatively large gains. Holding companies and affiliates of the LS Group, including LS (6.50%), LS Networks (5.51%), and LS Eco Energy (6.54%), all showed a simultaneous upward trend.

The strength in wire stocks is interpreted as a result of news that the U.S. FCC is reviewing and updating regulations related to submarine cables. According to major local foreign media, the FCC plans to revise related rules to allow only companies trusted for security, such as those from European Union (EU) member countries and other allied nations, to be used as cable suppliers, citing national security reasons.

As a result, expectations have grown that domestic wire and cable companies will gain a windfall benefit.