WhyItDropped

KOSPI · March 4, 2009

A jump on hopes of Chinese stimulus

+3.29%

single-day change vs previous close

Part of a longer stretch

What seven months off the bottom recovered

early in it · 2009-03-02 → 2009-09-22, +68.71% over the whole period

What happened that day?

  • The KOSPI rose 3.29% on the day. The bottom of this phase had come two sessions earlier
  • Word spread that China would announce further stimulus ahead of its National People's Congress
  • Chinese stimulus works especially well for Korea because of what Korea sells — steel, chemicals and machinery are what China uses for construction and plant, and they make up a large share of Korean exports
  • The calculation underlying the market here was that Korean exports hold up even if America breaks, so long as China keeps buying
  • Chinese stimulus did much to make Korea's 2009 recovery faster than most
  • The same structure works in reverse. When China wobbled in 2015, Korea was hit first

Sources

Every figure on this page is recomputed from the original daily closing prices and checked against them at build time. The account of what happened is written from the sources listed above.