In light of President Donald Trump’s recent statement suggesting the war is in its final stages, iM Securities predicts a strong rebound in the South Korean stock market, influenced by Trump’s apparent exit strategy.
Park Sang-hyun, an analyst at iM Securities, stated that this significantly reduces the risk of a prolonged conflict, which is undoubtedly positive. He added that they expect a particularly strong recovery in Asian financial markets, including South Korea, which have been disproportionately affected by the recent Iran situation.
While President Trump initially indicated that military operations in Iran would last about four to five weeks, he abruptly changed his stance on Monday, declaring that the war is winding down and the Iran conflict would be a short trip.
Park explained that Trump’s visible exit strategy stems from a combination of political and economic factors. He can’t ignore the anti-war sentiment in the U.S., and he must consider potential inflation risks due to rising oil prices, as well as the increasing financial burden, Park noted.
However, Park cautioned that tensions with Iran persist, emphasizing the need to closely monitor oil price trends.
He stated that although President Trump has outlined his exit strategy, he could easily reverse his statements, meaning the Iranian threat won’t completely disappear. Park stressed the importance of watching whether the risk of a Strait of Hormuz blockade will be fully resolved.
Park concluded that fortunately, the likelihood of extinguishing the major threat of prolonged warfare has increased, but it seems more time is needed for a complete resolution of the situation. He advised continued vigilance regarding international oil price trends in the near term.