Shares of shipbuilding companies are rising in early trading on April 9 following news that Acting President and Prime Minister Han Duck-soo and U.S. President Donald Trump discussed cooperation in the shipbuilding industry during a phone call overnight.
As of 9:24 a.m. on the KOSPI market that day, HD Korea Shipbuilding & Offshore Engineering was trading at 201,000 won ($136), up 4.74% from the previous session. Hanwha Ocean rose 2.22% to 69,200 won, and HJ Shipbuilding & Construction was up 1.9% at 6,420 won.
This is believed to be driven by the impact of the overnight phone call between Acting President Han and President Trump, during which the two leaders discussed strengthening cooperation in the shipbuilding sector.
It is reported that Acting President Han particularly emphasized a strong willingness to cooperate in three major areas: shipbuilding, liquefied natural gas (LNG), and trade balance.
Following the call, President Trump posted on social media, “We talked about their tremendous and unsustainable Surplus, Tariffs, Shipbuilding, large scale purchase of U.S. LNG, their joint venture in an Alaska Pipeline, and payment for the big time Military Protection we provide to Korea.”
Shipbuilding stocks have been performing relatively well despite the recent market downturn, boosted by expectations of strengthened cooperation with the United States. Amid this, Jeong In-kyo, head of the Trade Negotiations Office at the Ministry of Trade, Industry and Energy, departed for Washington, D.C., to negotiate tariffs with the U.S.Before his departure on the previous day, Jeong told reporters at Incheon International Airport that he would “seriously negotiate with the U.S. Department of Commerce and the Office of the U.S. Trade Representative (USTR) on various measures, including reciprocal tariffs.”
Additionally, the stock rally intensified after news broke that HD Hyundai had signed a memorandum of understanding (MOU) for technological cooperation with Huntington Ingalls Industries, the largest defense shipbuilder in the U.S. a day earlier.
As of 9:17 a.m. on Apr. 9, Nexteel was trading at 12,880 won, up 1,720 won, or 15.41%, from the previous session. Other related stocks such as Dong Yang Steel Pipe, up 7.16%, Husteel, up 7.05%, and SeAh Steel, up 4.15% were also posting gains.
With a 25% tariff expected to be imposed on South Korea’s major export item, steel, buying sentiment appears to have been boosted by expectations that negotiations might ease the tariff burden. The reciprocal tariffs are scheduled to take effect from 1 p.m. Korean time on Apr. 9.
Furthermore, Jeong stated that he would put Alaska LNG development and shipbuilding cooperation on the negotiation table with the U.S., which is also improving investment sentiment in shipbuilding and LNG-related stocks.
Shipbuilding stocks, including HD Korea Shipbuilding & Offshore Engineering, which rose 4.74%, HJ Shipbuilding & Construction, up 2.22%, Hanwha Ocean, up 1.92%, and Samsung Heavy Industries, up 1.36%, were climbing across the board, while POSCO International, up 4.66%, and Korea Gas Corporation, up 2.15%, were also advancing.
Source: Business Korea
