On the morning of August 20, Japanese and Korean stock markets opened broadly lower. The Korean KOSPI index fell 1.98% to 3,089.26 points.
According to market news, Bank of Korea Governor Lee Chang-yong stated that the economy rebounded in the second quarter, but due to uncertainties surrounding trade negotiations among major economies, the central bank will comprehensively assess whether to restart the easing cycle when formulating monetary policy next week.
Lee Chang-yong emphasized during his speech to a parliamentary committee on Tuesday that when setting policy on August 28, a series of factors must be considered to determine whether to resume the monetary easing cycle. He noted that financial stability risks are emerging due to rising default rates among small businesses and regional developers. Following recent government measures to curb mortgage lending, housing debt growth has slowed, but property prices in some areas of Seoul remain elevated.
Regarding economic growth, Lee Chang-yong indicated that economic growth momentum should continue in the second half with support from supplementary budgets. However, he warned that tariff negotiation risks remain high. On prices, Lee Chang-yong added that while adverse weather conditions might drive up food costs, stable energy prices and weak demand could keep inflation near the Bank of Korea's 2% target.
Additionally, data from Korea's Ministry of Trade, Industry and Energy showed that Korean automotive exports in July increased 8.8% year-over-year to $5.83 billion, marking the second consecutive month of growth. Exports to the EU surged 32.7%, largely offsetting the decline in U.S. exports caused by American tariffs. Exports to the U.S. fell for the fifth consecutive month, declining 4.6% year-over-year to $2.33 billion in July, though the pace of decline significantly slowed from 16% in June.
Meanwhile, Japanese stock markets opened lower and continued declining, with the Nikkei 225 index extending losses to 1.68%. Japanese technology stocks came under pressure, with Softbank Group Corp shares plummeting over 8%, while Soxsei Technology, Fujikura, and Advantest fell more than 4%.
On August 19, Softbank Group Corp and Intel Corporation announced the signing of a definitive securities purchase agreement. Under the agreement, Softbank will subscribe to Intel common shares at $23 per share, with a total investment of $2 billion. The transaction is subject to customary closing conditions. Upon completion, Softbank will hold approximately 2% of shares, becoming Intel's fifth-largest shareholder. According to the announcement, these funds will support Intel's manufacturing transformation and artificial intelligence ecosystem development in the United States.