What Happened

On May 7, 2026 (local time), Donald Trump, the U.S. President, saw his proposed 'global 10% tariff,' intended to replace existing rulings on reciprocal tariff violations, ruled unlawful by the U.S. Court of International Trade in its first instance. According to Maeil Business Newspaper reports, the court reportedly determined that this tariff exceeded the President's authority. This puts a brake on Trump's protectionist policies, which he had championed as a key pledge for his potential second term, further amplifying uncertainty regarding the future direction of U.S. trade policy. Meanwhile, Trump reportedly invited CEOs of major U.S. companies such as NVIDIA, Apple, Exxon, and Boeing to accompany him on his visit to China, demonstrating a dual strategy of linking trade pressure with corporate interests.

Why It Matters

Former President Trump has pledged to impose a uniform 10% tariff on all imports if re-elected. This court ruling indicates that such a policy could face legal limitations, signaling that his trade policies may not be implemented as easily as anticipated. However, it is difficult to conclude that Trump's protectionist stance will weaken simultaneously. This is because he is highly likely to circumvent legal restrictions or pursue similar policies in different forms. This will perpetuate uncertainty in global supply chains and exacerbate confusion for major trading partners in formulating their trade strategies. In particular, if U.S.-China trade tensions intensify, the fragmentation of the global economy could accelerate, potentially requiring fundamental changes in production and sales strategies for companies worldwide.

Impact on the Korean Market

The uncertainty in U.S. trade policy poses a significant burden on Korean export companies. If Trump's 10% tariff is actually implemented, Korean companies highly dependent on exports to the U.S. could suffer direct blows. While this ruling offers temporary relief, preparation for trade friction is essential given the persistent possibility of Trump's re-election. The possibility of tariffs on key export items such as semiconductors, automobiles, and steel could affect investment and production plans across domestic industries. Furthermore, intensifying U.S.-China tensions will pressure Korean companies to restructure supply chains and diversify production bases, which could lead to new investments and increased costs. The volatility of the Korean Won could also increase.

Key Stock Analysis

  • Samsung Electronics (005930): Currently building a semiconductor factory in the U.S. and with a high proportion of exports to the U.S., Samsung Electronics will be sensitive to changes in U.S. trade policy. Tariffs could lead to upward pressure on costs. (sentiment: negative)
  • Hyundai Motor (005380): The U.S. market is one of Hyundai Motor's core markets. Tariffs could lead to weakened price competitiveness and decreased sales, which is negative. Localization strategies for production bases will become even more crucial. (sentiment: negative)
  • Kia (000270): Similar to Hyundai Motor, Kia is highly dependent on the U.S. market and vulnerable to changes in tariff policy. Flexible responses, including production base strategies, are necessary, and an increase in local production proportion may be required. (sentiment: negative)
  • SK Hynix (000660): Semiconductors are a core item in the global supply chain, and changes in U.S. trade policy could affect SK Hynix's export strategy and production plans. Complex impacts could arise, especially if technological conflicts with China intensify. (sentiment: neutral)
  • POSCO Holdings (005490): Steel products have been subject to U.S. trade regulations in the past, so strengthened protectionism could lead to additional tariff burdens. This could result in deteriorating profitability. (sentiment: negative)
  • Lotte Chemical (011170): Petrochemical products could also see weakened export competitiveness if subjected to tariffs. Increased raw material procurement costs due to global supply chain restructuring are also a concern. (sentiment: negative)
  • WHEAT: U.S. protectionism could also affect agricultural markets. Tariffs or trade barriers could increase global grain price volatility, posing a burden on import-dependent countries. (sentiment: neutral)
  • US10Y (U.S. 10-year Treasury): Trade policy uncertainty can dampen corporate investment sentiment and negatively impact economic growth. This could also influence central bank monetary policy, causing volatility in the bond market. Increased uncertainty might also stimulate a preference for safe-haven assets. (sentiment: neutral)

Future Scenarios

Optimistic Scenario: This court ruling could act as a check on the Trump administration's excessive protectionist policies, potentially leading future trade policies to develop in a more rational direction. If free trade principles are maintained even after the U.S. presidential election, global supply chain stability could be secured, and corporate uncertainty could be alleviated. This would positively impact global trade volume and economic growth.

Pessimistic Scenario: Despite this ruling, Trump is highly likely to pursue protectionist policies through various means, such as employing other legal avenues or enacting legislation through Congress if re-elected. In this case, trade conflicts between the U.S. and major trading partners would intensify, hindering global economic growth and continuously pressuring corporate profitability. Specifically, targeted tariffs or non-tariff barriers on certain industries could be strengthened. Investors should closely monitor the U.S. presidential election results and Trump's future trade-related statements and policy proposals, and meticulously analyze companies' strategies for responding to changes in global supply chains.