S. Korea stocks on track for bull market as Lee's election win fuels reform bets

South Korea's equity benchmark climbed and is on track to enter a bull market, after Mr Lee Jae-myung's widely expected win in the presidential election ended a months-long political leadership vacuum.

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SEOUL -

The Kospi Index ended 2.7 per cent higher on June 4, taking its gain from the April low to more than 20 per cent, as investors piled into potential beneficiaries of Mr Lee's reform and growth agenda.

Holding companies, financial firms and brokerage stocks charged the Kospi higher on anticipation that Mr Lee would seek to implement a key legislative change as early as June that aims to boost shareholder returns.

The won rose 0.7 per cent against the US dollar, extending its rally into a second trading session. Korean government bonds underperformed with the 10-year yield rising about 10 basis points, while the bond futures of the same tenor dropped to the lowest since February, reflecting concerns about more supply due to the new administration's likely expansionary fiscal policy.

The election outcome removes one of the biggest overhangs impacting the local market - how the country proceeds politically after former president Yoon Suk Yeol's brief imposition of martial law in 2024, which led to his ouster and the June 3 snap election.