US stocks start December cold; Korea stocks fall due to political chaos

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Martial law was declared and lifted in South Korea
South Korean President Yoon Suk Yeol made the announcement early Wednesday morning Abolishes emergency martial law After the National Assembly Yoon voted to rescind his order Issued late Tuesday night. Yoon has clashed with the opposition over the 2025 budget in recent weeks. It is a coalition of MLAs of opposition parties Reported It plans to introduce a bill to impeach Yoon on Wednesday.

South Korean markets are rolling
South Korean markets Wednesday opened lower As investors digested the political turmoil. The Kospi lost about 1.6%, as did South Korea Heavyweight stocks Samsung Electronics, Hyundai Motor and Korea Gas Corp. stumbled. have won Recovered from previous steep losses – It fell to a two-year low against the US dollar – but ended the day lower against the greenback.

Emergency measures from BOK
The morning after Yoon’s shock move, the Bank of Korea said it would do the same Increase short-term liquidity and provide special loans as needed to stabilize the country’s financial and foreign exchange markets. However, the impact on markets could be “short-lived”, Citi analysts wrote in a note, unless there is a “proactive policy response”.

Mixed markets
There were US markets Mixed on Tuesday. The S&P 500 was flat, the Dow Jones Industrial Average fell but the Nasdaq Composite rose Asia-Pacific markets also traded higher Mixed on Wednesday. of Australia S&P/ASX 200 It lost 0.38% as the country’s statistics agency reported gross domestic product growth 0.3% slower than expected In the three months from September.

(PRO) Opportunities Amid France’s Political Chaos
South Korea aside, France is also facing its own political turmoil, the country’s legislators said A vote of no confidence Against the government of Prime Minister Michel Barnier. That political uncertainty is reverberating through financial markets, Offers business opportunities.

The S&P 500 was essentially flat and Dow Jones Industrial Average It has fallen by 0.17 percent. The Nasdaq CompositeHowever, managed to rise 0.4%, thanks Apple Up 1.3% to a new 52-week high.

Stocks are unlikely to remain in permafrost this month.

December is historically the The third best month of the yearAccording to the Stock Trader’s Almanac.

The stock market may fall slightly in early December, Writes CNBC’s Bob Pisani said tax loss selling is a phenomenon where investors sell loss-making assets to reduce the tax burden on other assets that make capital gains. But stocks will regain forward momentum as the year ends.

“These strong returns have historically typically been back-end loaded,” said George Smith, portfolio strategist at LPL Financial.

Furthermore, in presidential election years, December typically moves up a notch Second best month For shares.

As Ken Mahoney, CEO of Mahoney Asset Management notes, “When the market went up 10% or more with the newly elected president, it never went down in December.”

Also, investors are awaiting the November US jobs report this Friday before making any major moves. The numbers are the US Federal Reserve’s last look at the labor market ahead of its December 17-18 rate-setting meeting.

Markets are currently pricing in a 73.8% chance the Fed will cut rates by 25 basis points at that meeting, a more optimistic bet than last week’s 59.4%. CME FedWatch tool.

If the Fed cuts rates, that cut will likely wipe out any lingering frostbite in the stock market, who will hear the sleigh bells ringing.

— CNBC’s Bob Pisani, Sarah Min, Hakyung Kim, Sean Conlon, Lisa Kailai Han and Alex Haring contributed to this report.