[Good Morning Stock Market] New York Stock Market Plunges Amid Tariff Concerns... Korean Stock Market Also Affected

The three major indices of the U.S. New York stock market all fell simultaneously. The impact came from U.S. President Donald Trump's warning to impose a 200% tariff on alcoholic beverages imported from the European Union (EU). On the 14th, the Korean stock market is also expected to start slightly lower due to the influence of the U.S. stock market.

Reuters Yonhap News

On the 13th (local time) in the New York stock market, the Dow Jones Industrial Average, centered on blue-chip stocks, closed at 48,813.57, down 537.36 points (1.3%) from the previous trading day. The S&P 500 index, focused on large-cap stocks, recorded 5,521.52, down 77.78 points (1.39%). The Nasdaq index, centered on technology stocks, closed at 17,303.01, down 345.44 points (1.96%).

The tariff threat from Trump led to the stock market decline. President Trump warned via social media that a 200% tariff would be imposed on all alcoholic beverage products imported from EU countries. This was a retaliatory threat after the EU imposed a 50% tariff on American whiskey as one of the countermeasures against the U.S.'s 25% tariffs on steel and aluminum.

The announced Producer Price Index (PPI) was also not positively received by the market. The U.S. Department of Labor announced that the February PPI showed no change from the previous month on a seasonally adjusted basis. This was below both January's 0.6% and the experts' forecast of 0.3%.

Ji-won Kim, a researcher at KB Securities, said, "Despite the slowdown in the February Producer Price Index, the New York stock market responded to the escalating tariff war by Trump, with the three major indices recording declines in the 1% range. President Trump emphasized his determination to enforce tariffs by stating he would impose a 200% tariff on European wines and liquors from countries like France, which heightened market anxiety."

The domestic stock market is also expected to start lower due to the weakness in the U.S. stock market. Concerns are that risks stemming from Trump will have an impact. Seong-hoon Lee, a researcher at Kiwoom Securities, explained, "The domestic stock market is expected to start in a slightly lower range, reflecting the sharp decline in the U.S. stock market caused by uncertainties over Trump's tariffs, concerns about a U.S. federal government shutdown, and declines in major big tech companies."

Researcher Ji-won Kim also said, "Although tariff risks were expected to gradually ease, the expanding trade conflicts and recession fears have sustained the weakness in the U.S. stock market. While the KOSPI closed slightly lower the previous day, showing relative strength, attention should be paid to the possibility of increased political risks."