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WEEKLY MARKET PULSE

Jakota Markets: Past Week in Review

Japan
South Korea
Taiwan
s 028260.KO s 207940.KO s 8630.TSE
Blue Chip 150
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Last week’s Jakota markets:

  • Japan’s Nikkei 225 declined 1.57% as higher than expected inflation fuelled expectations for additional BoJ tightening, while the yen strengthened to its highest level in over two weeks
  • South Korea’s KOSPI dropped 1.3% amid risk averse sentiment following Moody’s U.S. credit rating downgrade and concerns over declining exports to key trading partners
  • Taiwan’s TAIEX lost 0.9% on U.S. market volatility concerns and semiconductor tariff uncertainty, offsetting strong AI driven industrial production growth of 20% plus
  • The JAKOTA Blue Chip 150 Index rose 0.5% buoyed by yen appreciation, with construction giant Samsung C&T surging on spinoff plans and insurer Sompo tumbling on weak profit forecasts

Japan

Japanese stocks retreated this week as the Nikkei 225 fell 1.57%, pressured by higher than expected inflation that heightened expectations for additional monetary tightening from the Bank of Japan (BoJ). The inflation data reinforced market concerns about the central bank’s policy trajectory.

Jakota Markets: Past Week in Review: image 1

On the trade front, chief negotiator Ryosei Akazawa reportedly reaffirmed Japan’s push for broader tariff exemptions ahead of a third round of trade talks in Washington.

The yen gained strength against the dollar, reaching ¥143.6 – its strongest level in more than two weeks. The currency’s rise was supported by the inflation surprise and ongoing concerns about the U.S. fiscal outlook. Finance Minister Katsunobu Kato told reporters he didn’t discuss currency levels with U.S. Treasury Secretary Scott Bessent during G-7 meetings in Canada, remarks that appeared aimed at downplaying speculation about coordinated intervention.

Core inflation accelerated to 3.5%, reaching its highest level in more than two years and bolstering expectations that price pressures are becoming more entrenched.

Jakota Markets: Past Week in Review: image 2

Economic data presented a mixed picture. Core machinery orders, a key indicator of capital spending, surged 13% in March, defying forecasts for a 1.6% decline and marking the strongest reading in nearly two decades. However, the au Jibun Bank Japan PMIs showed manufacturing activity continued to contract, while growth in the services sector lost momentum in May, weighed down by softer demand and mounting uncertainty over potential U.S. tariffs.

South Korea

South Korea’s stock market fell this week, with the KOSPI sliding 1.3% as investor sentiment turned risk averse following Moody’s downgrade of the U.S. credit rating, which stoked concerns over global financial stability.

Jakota Markets: Past Week in Review: image 3

The country’s exports to the U.S. and China are likely to fall further in May as the effects of the Trump administration’s broad tariff regime take hold. The warning followed preliminary government data showing a 2.4% year-over-year decline in exports during the first 20 days of May, driven largely by weaker shipments to the U.S. amid persistent tariff pressures.

Taiwan

Taiwan’s stock market lost ground this week, with the TAIEX declining 0.9% amid fears over volatility in U.S. markets after Moody’s stripped the U.S. of its top credit rating and as investor sentiment wavered over the potential for new U.S. semiconductor tariffs.

Jakota Markets: Past Week in Review: image 4

On the economic front, Taiwan’s industrial production rose more than 20% from a year earlier in April, marking the 14th consecutive month of year-over-year growth, according to the Ministry of Economic Affairs (MOEA). The strong performance was driven by robust global demand for AI applications.

JAKOTA Blue Chip 150 Index

The JAKOTA Blue Chip 150 Index gained 0.5% this week, supported largely by yen strength.

Samsung C&T, a South Korean construction and engineering company, jumped 14.6% to lead gains on the JAKOTA Blue Chip 150 Index after Samsung Biologics, the world’s largest contract drug manufacturer, announced plans to spin off its contract development and manufacturing (CDMO) business from its biosimilar and novel drug development operations, currently housed under wholly owned unit Samsung Bioepis. The restructuring is expected to enhance the valuation outlook for both Samsung Biologics and Samsung Bioepis while lifting the overall value of parent company Samsung C&T.

Jakota Markets: Past Week in Review: image 5
Source: The Korea Economic Daily

Jakota Markets: Past Week in Review: image 6

Sompo, a Japanese insurance holding company, was among the worst performers on the JAKOTA Blue Chip 150 Index this week, dragged down by a disappointing earnings outlook. Shares fell after the company’s consolidated net profit forecast for the fiscal year ending March 31, 2026, came in well below market expectations. The announcement, made on Tuesday, May 20, 2025, overshadowed an otherwise solid performance for the recently concluded fiscal year.

For the fiscal year ending March 31, 2025, Sompo reported growth in both ordinary and net income, exceeding its own guidance issued in November 2024. However, its projection of ¥335 billion in net profit for the current fiscal year fell short of the analysts’ consensus estimate of ¥424.38 billion.

Jakota Markets: Past Week in Review: image 7

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