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Top 10 Korean Stocks to Watch in the Era of U.S.–China Tariff Risks – In-Depth Stock Analysis for Investors

AI Prompt 2025. 7. 6. 10:24
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Top 10 Korean Stocks to Watch in the Era of U.S.–China Tariff Risks – In-Depth Stock Analysis for Investors

※ trade tensions between the U.S. and China have re-escalated, particularly with the possibility of stricter U.S. tariff policies targeting products from China. As strategic industries—such as semiconductors, electronics, advanced materials, secondary batteries, automotive parts, and consumer goods—undergo supply chain restructuring, the Korean economy and its stock market are inevitably exposed to direct and indirect impacts.
This blog post systematically explores how the possibility (or actual implementation) of additional U.S. tariffs on Chinese products and raw materials affects listed Korean companies on KOSPI and KOSDAQ. We analyze stocks likely to benefit or suffer due to U.S.–China tariff-related risks, cover the latest technical trends, and discuss long-term investment strategies. The analysis is structured for expert investors managing portfolios and risk in an uncertain global environment. 😅

 

Overview

The Biden administration and the U.S. Congress have imposed or announced additional tariffs and import restrictions on Chinese products, including semiconductors, electric vehicles, renewable energy products, and high-tech consumer goods. Korean companies, positioned at the core of global supply chains and maintaining dual production systems for both the U.S. and Chinese export markets, are keenly sensitive to changes in tariff policies.

On the other hand, as global value chains shift, Korean components and materials may see increased substitution demand. The rerouting of production away from China to Korea or other third countries may also present new opportunities. Below, we present the top 10 notable Korean stocks and an expert structural analysis of industry-by-industry impacts resulting from U.S.–China tariff risks.

Top 10 Recommended Korean Stocks (Ticker)

  1. Samsung Electronics (005930)
  2. SK Hynix (000660)
  3. LG Energy Solution (373220)
  4. Samsung SDI (006400)
  5. Hyundai Motor (005380)
  6. Kia Corporation (000270)
  7. POSCO Holdings (005490)
  8. Iljin Materials (020150)
  9. Hanwha Solutions (009830)
  10. Korean Air (003490)

Factors Driving Stock Price Increases

1. Alternative Exports to China and Global Supply Chain Diversification

  • Stricter U.S. tariffs on Chinese goods are likely to boost demand for Korean-made semiconductors, components, materials, secondary batteries, and automobiles in the U.S. market.
  • Samsung Electronics, SK Hynix, LG Energy Solution, and Samsung SDI benefit from high global market shares in advanced IT, batteries, mobility, and automotive semiconductors, making them long-term beneficiaries.
  • Hyundai Motor and Kia are mitigating supply chain risk by expanding local production and component sourcing in the U.S. and Europe, and are participating in the global EV (electric vehicle) boom.

2. Strategic Shift Away from Chinese Raw Materials/Finished Products and Upgrading Domestic Industrial Value

  • If U.S. tariffs on Chinese semiconductors, batteries, steel, or renewable energy products rise, Korean and third-country products can capture more market share.
  • POSCO Holdings, Hanwha Solutions, and Iljin Materials are expected to structurally benefit from reduced dependence on Chinese materials, R&D advancements, and strengthened technology.

3. Large-Scale Supply Chain Investments and Capacity Expansion in Korea

  • Tech giants, bio-pharma, and next-generation battery firms are actively establishing plants and production hubs in Korea, expanding the ecosystem for mid-sized and small partner companies.
  • The Korean government continues to support with investments, tax deductions, and workforce policies.

4. Expansion of Global Logistics, Airline, and Logistics IT Services

  • As U.S.–China trade flows shrink and alternative export routes expand, Korean Air and other logistics service providers may see higher demand for ocean and air freight services.

Factors Contributing to Stock Price Declines

1. Decreased Exports to China and Global Demand Slowdown

  • Major exporters like Samsung Electronics, SK Hynix, Hyundai Motor, and LG Energy Solution remain reliant on the Chinese market. Escalation of U.S.–China trade war may lead to lower exports to China and higher inventory burdens, negatively affecting short-term results.
  • Risks exist for Korean products to lose market share due to weaker Chinese consumption, rising local competition, and reduced price competitiveness.

2. Higher Import Costs for Raw Materials and Components

  • Tariffs, increased shipping costs, and more expensive Chinese raw or intermediate goods threaten to squeeze profit margins for Korean producers.
  • POSCO Holdings, Iljin Materials, and Hanwha Solutions remain exposed to international commodity and energy price volatility.

3. Erosion of Corporate Global Competitiveness and the Spread of Alternatives

  • As U.S./European firms energetically decouple their supply chains from China, Korean companies face head-on competition from those multinationals.
  • If supply chains continue to shift to emerging countries like Southeast Asia and India, Korean firms may face growing burdens from marketing and R&D investments.

4. Foreign Exchange Fluctuations and Financial Market Volatility

  • Heightened KRW-CNY-USD exchange rate volatility and global financial instability raise risk for large Korean exporters with substantial international operations.
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Technical Analysis and Future Trading Value

Samsung Electronics, SK Hynix, LG Energy Solution, Samsung SDI

  • As hubs of global semiconductor/battery supply chains, recorded a roughly 20% rise in H1 2024, followed by short-term corrections.
  • After confirming support at 60-to-120-day moving averages, steps of renewed accumulation are evident.
  • Valuations: PER (12~20x), PBR (1.3–3.0x); valuation pressure is limited compared to growth momentum.

Hyundai Motor, Kia

  • Expansion of new EV factories and battery cell lines in the U.S./EU; IRA (Inflation Reduction Act) incentives for EVs fueled strong performance in H1 2024.
  • RSI in the 60–70 range, alternating between buying and profit-taking; periodic accumulation at appropriate mid-term price levels is recommended.

POSCO Holdings, Iljin Materials, Hanwha Solutions

  • Among materials and energy stocks, “Koreanization” of items formerly dependent on China and export diversification are highlighted.
  • Over the last five months, trading volumes expanded, and stocks surged 40%+ from the bottom, with multiple MACD golden crosses noted.
  • Beware of overheated sentiment during short-term run-ups.

Korean Air

  • Clear improvement in earnings due to changes in global logistics routes and expanded alternative exports.
  • Both passenger and cargo figures normalized post COVID-19; long-term growth value is emerging.
  • Average beta is about 1.1 versus the KOSPI, indicating medium-level volatility.

Investment Outlook and Considerations

1. Need for Industry-by-Industry Supply Chain Strategies and Portfolio Diversification

  • U.S. tariff risks on China often create short-term volatility around theme stocks, but the key is sustainable market share, technological independence, and robust global production networks.
  • Carefully examine Chinese, U.S., and third-country export ratios, local content rates, and R&D/expenditure efforts for each sector.

2. Safer to Identify Mid- and Long-Term Growth Stocks Versus Short-Term Theme Trades

  • Tariff themes are vulnerable to rapid fluctuations driven by policy news and FX shifts, requiring staged profit-taking and portfolio rebalancing.
  • In the long run, select companies with strong internalized R&D, global partnerships, and advanced ESG (environmental-social-governance) practices.

3. Vigilant Monitoring of Policy and Global Financial Conditions

  • Be prepared with contingency plans for rapid tariff escalations, easing, interest rate or liquidity changes, or currency shocks from both the U.S. and China.
  • Watch Korean government support for next-gen industries (semiconductors, batteries, autos) and related tax/support measures.

4. Rigorous Stock Screening Based on Earnings & Financial Structure

  • During market overheating, minimize risk through close analysis of profitability, cash flows, and debt ratios.
  • When business conditions deteriorate or external variables worsen, rebalance the portfolio and adjust cash allocations accordingly.

Conclusion

In 2024, U.S.–China tariff risks bring both short-term volatility and long-term opportunities to the Korean stock market. During these fluctuations, prioritized diversification into fundamentally strong, globally competitive blue chips with internalized technology and sustainability is the wise strategy.

By staying nimble to macro and policy changes, while simultaneously identifying companies with core growth engines, investors can achieve stable asset growth even in times of uncertainty. Design your investment strategies for the changing global supply chain with prudence and rigor in the face of U.S.–China tariff risks.

For further corporate/sector analysis or portfolio consultation, please feel free to reach out at any time.

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