South Korean shares slumped 1 per cent on Friday as Japan's decision to remove Seoul from fast-track export status put further strain on the trade-dependent economy, which is already reeling from the broadening fallout of the Sino-US trade war.
The decision would take effect from Aug 28, Japan's Industry Minister Hiroshige Seko told a briefing."It's hard to gauge its impact as of now. Japan may approve some exports smoothly, while making the process difficult for certain items," said Ku Yong-uk, chief of Mirae Asset Daewoo research centre."It will affect some small- and mid-sized manufacturers, which import precision machineries from Japan," said Seo Sang-young, an analyst at Kiwoom Securities.
Sentiment was already gloomy when trading began after US President Donald Trump on Thursday said he plans to impose a 10 per cent tariff on US$300 billion of Chinese imports from next month in a sharp escalation of the year-long trade dispute, sending global stocks sliding and triggering a rush to safe-haven assets.Stationery-maker Monami Co Ltd surged more than 17.4 per cent, while apparel makers Shinsung Tongsang Co Ltd and Sbw Inc rallied 6.5 per cent and 4.2 per cent, respectively.