[Good Morning Market] US-Vietnam Trade Deal Sends S&P 500 to Record High... KOSPI Expected to Open Higher

'Commercial Act Amendment' Passes National Assembly with Bipartisan Agreement
"Expected to Drive Foreign Buying"

On July 2 (local time), the S&P 500 index hit a new all-time high following news that the United States had reached a trade agreement with Vietnam. As the domestic stock market is also expected to open higher due to the impact of the trade deal, attention is turning to the amendment to the Commercial Act, which has passed the National Assembly.

On the New York Stock Exchange that day, the S&P 500 index closed at 6,227.42, up 29.41 points (0.47%) from the previous session, surpassing the previous high set on June 30. The tech-heavy Nasdaq Composite closed at 20,393.13, up 190.24 points (0.94%) from the previous session, coming close to its all-time high. The Dow Jones Industrial Average closed at 44,484.42, down 10.52 points (-0.02%) from the previous session.

New York Stock Exchange scene. Photo by Reuters Yonhap News

On the same day, U.S. President Donald Trump announced via his social media platform, Truth Social, that tariffs on Vietnam would be reduced to 20% as a result of the trade agreement. The reciprocal tariff previously imposed on Vietnam was 46%.

Nike, which relies heavily on manufacturing shoes in Vietnam, rose 4.06% after the announcement of the agreement.

By stock, Tesla's share price rose 4.97% after the company reported that its second-quarter vehicle deliveries were not as bad as feared. Most semiconductor stocks also advanced, including Nvidia (2.58%), AMD (1.77%), Broadcom (1.95%), and TSMC (3.97%).

Centene, a leading U.S. health insurance company, plunged 40% after withdrawing its earnings guidance for the year due to poor performance in its health insurance exchange business.

Meanwhile, concerns about the U.S. economic outlook also emerged, limiting stock price gains from the tariff agreement. Automatic Data Processing (ADP), a U.S. employment information company, reported that private sector employment in the United States decreased by 33,000 jobs in June compared to the previous month. This marks the first monthly decline in private sector employment in two years and three months.

Amid heightened concerns about an economic slowdown due to the Trump administration's tariff policies, the market is closely monitoring changes in the labor market as an indicator of economic trends.

On July 3, the domestic stock market is expected to open higher in response to the U.S.-Vietnam trade agreement. In addition, the impact of the amendment to the Commercial Act, which passed the National Assembly's Legislation and Judiciary Committee after bipartisan agreement following the previous day's market close, is expected to be reflected.

Lee Sunghoon, a researcher at Kiwoom Securities, said, "In the short term, as the market digests these events, there may be some profit-taking in holding companies and securities sectors." He added, "However, the main driving force behind the inflows into sectors benefiting from the Commercial Act amendment has been domestic institutional investors, while foreign investors have maintained a neutral stance due to doubts about the actual implementation of the policy. The passage of the amendment is expected to serve as a catalyst for foreign buying by reducing uncertainty in these sectors."

The main points of the Commercial Act amendment are as follows: ▲ Explicitly stipulating that company directors have a duty of loyalty to shareholders ▲ Introduction of electronic general meetings of shareholders ▲ Converting outside directors into independent directors ▲ Limiting the voting rights of the largest shareholder and related parties to 3% when appointing audit committee members.