Why iShares MSCI Korea ETF (EWY) fell 2.99%
iShares MSCI Korea ETF (EWY) fell 2.99% on October 7, 2026 — Trump's 300% tariff threat hits Korea stocks.
What happened
Trump threatened tariffs up to 300% as Korea faces pressure over US investment, triggering a 3% selloff in the MSCI Korea ETF as foreign capital rotated out of EM exposure tied to Korea's export economy.
Why it moved
Korea's economy is deeply trade-dependent; tariff risk compresses valuations via reduced export volumes, weaker capex plans, and won weakness, all of which lower medium-term earnings for the ETF's holdings.
Why it matters
Korea Tech had thrived on AI tailwinds and open trade; tariff threats undermine both the thematic case (memory demand) and the structural case (EM growth via exports), forcing ETF flows to reassess.
What would break the thesis
If tariffs are delayed, narrowed, or exempt key Korean names, EWY should recover; conversely, if tariffs are imposed and sustained, Korea's growth outlook and valuations face a downward reset.