(Bloomberg) -- South Korean equities rose on Tuesday, seeking their first daily advance since last week’s short-lived martial law thrust the country into political turmoil. The won edged higher against the dollar.
The Kospi Index gained as much as 2.4% during morning trading, after recent losses pushed the benchmark to the brink of bear market territory. The small-cap Kosdaq gauge jumped more than 4%. The aggregate market value of companies included in the two benchmarks declined by $100 billion in four sessions through Monday.
The rebound comes as authorities have repeatedly vowed all steps to stabilize sentiment, describing the latest market moves as “excessive” when considering the country’s economic fundamentals. Investors have been grappling with heightened uncertainties as the opposition continues to push for President Yoon Suk Yeol’s ouster after he narrowly survived an impeachment vote over the weekend.
Read: South Korean Stocks, Won Slump as Political Crisis Deepens
While Tuesday’s advance offers some relief, markets may see another bout of volatility as the political wrangling continues. Yoon is banned from traveling overseas amid a series of probes related to his martial law decree, and a local report said the ruling party will disclose a road map for an “orderly exit” of the president on Tuesday.
“This is just a reversal of recent moves, since there’s actually not much change on the politics side,” said Marcello Seongsoo Ahn, a portfolio manager at Quad Investment Management Co. “Caution remains as some development likely to happen over the next 10 days.”
Korean equities were already among the world’s worst performers this year before the political drama unfolded, with Donald Trump’s election win and China’s fragile economic outlook weighing on the trade-dependent economy. A lackluster performance by Samsung Electronics Co., the country’s largest stock, has also weighed.
The won rose as much as 0.4% to 1,425.50 per dollar on Tuesday, while the nation’s three-year bond futures slipped. Down nearly 10% against the greenback this year, the Korean currency has underperformed its peers in Asia.
--With assistance from Winnie Hsu and Hooyeon Kim.
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