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  • Economy

    MSCI keeps Korea off developed market watchlist, but global analysts stay bullish

    MSCI's decision to keep Korea off its watchlist for potential inclusion in the Developed Market Index has pushed back expectations for index-driven inflows, but analysts say the setback does little to weaken investors' constructive view of the country's stock market, which remains underpinned by artificial intelligence (AI)-related momentum. Wee Khoon Chong, APAC macro strategist at BNY, noted that the Korean stock market is in a favorable position thanks to AI-related growth momentum, even without inclusion in the Developed Market Index. "Inclusion in the MSCI Developed Market Index would be welcomed, bringing additional passive inflows, but a status quo MSCI decision would not change investors' constructive investment thesis on South Korea," he added. Korea was not added to MSCI's Developed Market Index watchlist in its 2026 market classification review, announced Wednesday. MSCI noted that underlying issues raised by global investors "have not been fully resolved." Korea was first included in the Emerging Markets Index in 1992 and was placed on MSCI's watchlist for potential inclusion

    2 MIN READBy Lee Yeon-woo
    MSCI keeps Korea off developed market watchlist, but global analysts stay bullish
  • Economy

    KOSPI rebounds from sharp sell-off on Samsung buyback hopes

    2 MIN READBy Lee Yeon-woo
    KOSPI rebounds from sharp sell-off on Samsung buyback hopes
  • Economy

    Retail sales rise 9% in May amid improving consumer sentiment

    1 MIN READBy Yonhap
    Retail sales rise 9% in May amid improving consumer sentiment
  • Economy

    Seoul to continue push for MSCI developed market status bid after remaining in emerging category

    2 MIN READBy Yonhap
    Seoul to continue push for MSCI developed market status bid after remaining in emerging category
  • Economy

    Korean won slumps against US dollar on expectations of Fed rate hike

    1 MIN READBy Yonhap
    Korean won slumps against US dollar on expectations of Fed rate hike
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CEO & Publisher: Oh Young-jinDigital News Email: webmaster@koreatimes.co.krTel: 02-724-2114Online newspaper registration No: 서울,아52844Date of registration: 2020.02.05Masthead: The Korea TimesCopyright © koreatimes.co.kr. All rights reserved.

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Economy

Pension fund rejects shareholder activism

The National Pension Service (NPS) Investment Management headquarters in Jeonju, North Jeolla Province / Courtesy of NPSAttention now focused on LG, Hankook & CompanyBy Park Jae-hyukInvestors are paying keen attention to the stance of the National Pension Service (NPS) on shareholder activism against LG and Hankook & Company, after the pension fund has shown a tendency to object to most shareholder proposals raised during the proxy season this year.As of Wednesday 3 p.m., the NPS did not disclose its position on LG's planned spin-off of the group's affiliates, which has faced backlash from U.S. hedge fund Whitebox Advisors and global proxy advisers, including Institutional Shareholder Services (ISS) and Glass Lewis. The state pension service also remained silent about shareholder proposals made by Hankook & Company Vice Chairman Cho Hyun-sik, who has been locked in a dispute with his younger brother, CEO Cho Hyun-bum, over control of the nation's leading tire maker.The NPS is the second-largest shareholder of LG's holding company, LG Corp., with a 7.81 percent stake and h

Mar 24, 2021By Park Jae-hyuk
Pension fund rejects shareholder activism
Economy

Overstimulated? Stocks soar 75% in historic 12-month run

The Wall Street sign is pictured at the New York Stock exchange (NYSE) in the Manhattan borough of New York City, March 9, 2020. Reuters-YonhapNEW YORK (AP) -- It was one year ago that the terrifying free fall for the stock market suddenly ended, ushering in one of its greatest runs.On March 23, 2020, the SP 500 fell 2.9%. In all, the index dropped nearly 34% in about a month, wiping out three years' worth of gains for the market.That turned out to be the bottom, even though the coronavirus pandemic worsened in the ensuing months and the economy sank deeper into recession. Massive amounts of support for the economy from the Federal Reserve and Congress limited how far stocks would fall. The market recovered all its losses by August.As time passed, the quick development of coronavirus vaccines helped stocks shoot even higher. So did growing legions of first-time investors, who suddenly had plenty of time to get into the market using free trading apps on their phones.It all led to a 76.1% surge for the SP 500 and a shocking return to record heights. This run looks to be one of the, if

Mar 23, 2021
Overstimulated? Stocks soar 75% in historic 12-month run
Economy

Creditors press SsangYong to cut labor costs to attract capital for revival

SsangYong Motor's plant in Pyeongtaek, Gyeonggi Province, in this file photo taken on Feb. 3. YonhapBy Lee Min-hyungCreditors of SsangYong Motor have stepped up pressure on the cash-strapped automaker to drastically cut labor costs, in a bid to attract investment from new potential investor HAAH Automotive Holdings.SsangYong is seeking to file for a prepackaged bankruptcy, but the plan has hit a snag after the company and the U.S.-based auto retailer failed recently to clinch a contract once again. HAAH was supposed to sign a deal with SsangYong for a capital injection by the end of February, but the plan has been delayed due to the automaker's weakening outlook for revival, amid falling sales.The Korea Development Bank (KDB), the main creditor of SsangYong, has urged the company to show its strong willingness for a revival by taking its cost-cutting measures to a “radical level,” if it hopes to attract capital from the new investor and creditor.As SsangYong is in dire need of capital to realize its plan for a prepackaged bankruptcy, the best-case scenario for the automak

Mar 23, 2021By Lee Min-hyung
Creditors press SsangYong to cut labor costs to attract capital for revival
Economy

NPS expands investment in global PEF

The headquarters of National Pension Service (NPS) located in Jeonju / Courtesy of NPSBy Anna J. ParkThe National Pension Service (NPS), the nation's largest institutional investor with around 835 trillion won ($740 billion), appears to have acquired a stake in a global private equity firm (PEF) for the first time a couple years ago, in an effort to increase the portion of alternative investments in its portfolio.According to the investment banking industry Tuesday, the NPS made a strategic investment into London-based PEF BC Partners sometime in 2019. The investment, however, is not a direct acquisition of the global PEF's stakes. It was rather an indirect and joint stake investment into the U.K. PEF through a Blackstone fund that acquired around 10 percent or 15 percent of BC Partners' stakes with about 500 million euros in the summer of 2019. New York-based Blackstone's Alternative Asset Management division acquired the stake in its London-based private equity rival with the raised capital through the fund to seek joint growth of the buyout industry. Although the specific amount o

Mar 23, 2021By Anna J. Park
NPS expands investment in global PEF
Economy

US Fed's Powell says public should understand risks of bitcoin

In this Tuesday, Dec. 1, 2020, file photo, U.S. Federal Reserve Chairman Jerome Powell, right, testifies before the Senate Banking Committee on Capitol Hill in Washington. Powell said the public needs to understand the risks behind cryptocurrencies. APFederal Reserve Chair Jerome Powell said Monday that the U.S. public needs to understand the risks behind Bitcoin and other cryptocurrencies, even as the central bank itself is studying the potential costs and benefits of a digital dollar. Powell said the Fed prefers to call crypto coins ``crypto assets,'' because their volatility undermines their ability to store value, a basic function of a currency. ``They're highly volatile, see Bitcoin, and therefore not really useful as a store of value,'' Powell said in remarks to a virtual summit hosted by the Bank for International Settlements. ``They're more of an asset for speculation. So they're also not particularly in use as a means of payment. ... It's essentially a substitute for gold rather than for the dollar.''Bitcoin has soared nearly ten-fold in value compared with a year ago, hover

Mar 23, 2021
US Fed's Powell says public should understand risks of bitcoin
Economy

Fed's decision expected to have limited impact on Korean stocks

GettyimagesbankBy Anna J. ParkThe U.S. Federal Reserve's announcement at the end of last week that it won't extend a capital relief measure that began at the start of the COVID-19 pandemic seems to be boosting uncertainty in global stock markets that are already volatile due to concerns over rising interest rates as well as growth stocks' valuations.The U.S. central bank's decision to end the capital relief by the end of this month means that banks cannot exclude government bonds in calculating the supplementary leverage ratio (SLR), which could possibly send jitters throughout global bond markets and cause negative repercussions on stock markets. The end of the SLR rule means that financial institutions have to sell off their holdings of U.S. Treasuries, which is generally interpreted as pressure to raise interest rates.However, market experts view that the impact of the Fed's decision to stop the banks' eased capital rule will be limited in the Korean stock market. “As commercial banks hold only about 5 percent of Treasury bonds, I think the end of the eased capital rule won'

Mar 22, 2021By Anna J. Park
Fed's decision expected to have limited impact on Korean stocks
Economy

Analysis Debate heats up over setting up real estate monitoring body

Apartment buildings in Seoul / Korea Times file Role, functions and limits to be clearly identified to prevent excessive government controlBy Lee Kyung-min The recent public fury over employees at the state-run Korea Land and Housing Corp. (LH) engaging in real estate speculation using insider information has prompted the need to set up a real estate monitoring body, a discussion stalled for months after President Moon Jae-in proposed the idea in August last year.The delay was due to concerns of possible abuse of private data by the government and subsequent infringement of people's property rights under the guise of rule of law.Also raising a major red flag is a clear lack of specifics to resolve the apparent conflicts of interest resulting from the make-up and management of the body to be supervised by the land ministry, since little accountability is expected from an investigation not overseen by a disinterested third party that remains free from identifying and

Mar 22, 2021By Lee Kyung-min
[Analysis] Debate heats up over setting up real estate monitoring body
Economy

Various global companies tapped as potential buyers of Bithumb

Bithumb Korea's headquarters in Seoul / Yonhap By Park Jae-hyukBithumb Korea is in the spotlight once again as the potential sale of the nation's leading cryptocurrency exchange operator has apparently attracted global suitors.Morgan Stanley, Deutsche Bank and JPMorgan are among the companies that are cited as the potential buyers of Bithumb Korea. (Although Morgan Stanley has officially denied media reports that it is planning to acquire a stake in Bithumb Korea.) Visa and Naver, along with an affiliate of the Chicago Mercantile Exchange (CME), are also said to be interested in acquiring Bithumb Korea from its major shareholder, Vidente. China's Binance, which runs the world's largest cryptocurrency exchange, is another candidate to possibly join the bid.However, it remains unclear whether they will keep vying with each other until the end of the bid. The progress of the deal had remained sluggish throughout last year, since Bithumb Korea's largest shareholder, Bit

Mar 22, 2021By Park Jae-hyuk
Various global companies tapped as potential buyers of Bithumb
Economy

Hahn & Co. set to exit Hanon Systems, K Car

Hahn & Company's head office in Seoul / Captured from Hahn & Company websiteMorgan Stanley said to handle sale of auto parts supplierBy Park Jae-hyukHahn & Company began to take steps to sell its controlling stake in Hanon Systems and to list K Car on the local stock market, industry sources said Monday.Hanon Systems is a major manufacturer of automotive equipment, while K Car is Korea's largest used-car dealership.Both Hanon Systems and K Car have maintained dominant positions in each of their sectors, and Hahn & Co. and the underwriters of each deal are highly likely to generate solid profits if the sales are successful.Morgan Stanley and NH Investment & Securities are cited as the lead underwriters of each deal at the moment, but a source familiar with the matter said additional investment banks may join the Hanon Systems deal as co-underwriters, considering the size of the company.Market insiders expect the sale of the auto parts supplier to be one of the biggest buyout deals in the domestic M&A market's history.The market cap of Hanon Systems has come clo

Mar 22, 2021By Park Jae-hyuk
Hahn & Co. set to exit Hanon Systems, K Car
Economy

Investors wary of buying stocks, real estate amid interest risks

Apartment complexes in Seoul are seen from above on March. 21. YonhapBy Lee Min-hyungInvestors here are growing increasingly wary of buying stocks and real estate in Korea amid growing fears of heightened interest rate volatility.According to the Korea Exchange, the Volatility Index of KOSPI 200 (V-KOSPI) has come to 21.98 for this year, as of Friday afternoon. The index refers to an expected volatility of the KOSPI 200 index option for the next 30 days. When the main bourse plunges, the V-KOSPI goes up.The V-KOSPI has in recent months been on a gradual decline, signaling that investors are taking a wait-and-see approach when it comes to the future of the benchmark stock index.The KOSPI surpassed the symbolic 3,000-mark for the first time in January on a nationwide stock-investment boom led by retail investors. It even reached as high as 3,200 points, but has been in an adjustment period for the past few weeks at around the 3,000-range.This was due to investors' fears over a possible interest rate hike here amid rising 10-year U.S. treasury yields which  hit 1.7 percent recently

Mar 22, 2021By Lee Min-hyung
Investors wary of buying stocks, real estate amid interest risks
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