Asian Stocks Drop as Korea Is Rocked by Political Unrest – Asia Market Wrap

Asian stocks fell after South Korea’s political upheaval, precipitated by a temporary declaration of martial law, put investors on edge.

The MSCI Asia Pacific Index dropped 0.3%, while the Kospi Index fell as much as 2.3%. Shares were neutral in Japan and fell in mainland China. The Won rose after falling overnight in offshore trading.

South Korean President Yoon Suk Yeol’s unexpected declaration of martial law late Tuesday, which was later overturned, looks to have thrown the country into political chaos, with the opposition pressing for his impeachment. The uncertainty surrounding a major economy and cornerstone of global commerce heightened investor caution in Asia, just as Trump’s looming return and China’s economic woes had lowered spirits.

The Australian Dollar fell as data revealed that Australia’s economic growth remained slow in the three months to September. Oil prices have stabilised following the largest gain in more than two weeks. Gold stabilised after gaining on Tuesday as political instability in South Korea and France boosted demand for safe-haven assets.

With all eyes on France’s political crisis, the Euro climbed higher against the Dollar. President Macron urged French MPs to put aside their personal ambitions and vote against overthrowing the government.