NH Investment & Securities "Buying Response Effective if Sharp Drop Occurs Early in Trading"

On the 4th, NH Investment & Securities advised that the declaration and lifting of the national martial law is not a fundamental factor affecting the Korean stock market, and therefore, buying in response to a sharp drop in stock prices in the early trading session is a valid strategy.

Researcher Na Jeong-hwan of NH Investment & Securities explained, "Since the issue of the emergency martial law declaration was quickly resolved, the overnight volatility expansion in the Korean financial market is likely to end as a mere incident," adding, "The Korean government is responding to stabilize the financial market."

He continued, "Deputy Prime Minister and Minister of Economy and Finance Choi Sang-mok announced that unlimited liquidity will be supplied to stabilize the financial and foreign exchange markets," and added, "The Bank of Korea will also hold an emergency Monetary Policy Committee meeting to discuss measures to stabilize the financial market."

Researcher Na also noted, "The declaration of emergency martial law may act as a wake-up call regarding austerity measures such as budget cuts," and expressed hope that "as dialogue between the ruling and opposition parties progresses rapidly, the austerity stance in fiscal policy may be somewhat eased." He stated, "Since the parliament was convened and the martial law was lifted quickly after its declaration, a positive view of the Korean political system may emerge."

Researcher Na analyzed, "There is also a scenario where President Yoon Seok-yeol’s impeachment motion is passed and the impeachment process begins," noting that "about 40 members of the National Assembly have demanded President Yoon’s impeachment following the martial law declaration." He added, "The number of lawmakers needed to block the impeachment motion is 101 seats," and explained, "Since the People Power Party holds 108 seats, if some members within the party join the presidential impeachment, the impeachment prosecution is also possible."