Jeju Air Stock Plummets to All-Time Low Following Tragic Plane Crash

Jeju Air, a South Korean budget carrier, faced a significant blow as its shares hit an unprecedented low after a fatal plane crash shook the nation. The incident unfolded against a backdrop of political upheaval, with three presidents taking office within a month in South Korea, intensifying market instability.

Devastating Crash and Market Reaction

Over the weekend, tragedy struck as a Jeju Air aircraft, en route from Bangkok's Suvarnabhumi International Airport, crashed upon landing in South Korea, claiming the lives of 179 individuals out of the 181 passengers and crew on board. In the aftermath, Jeju Air's stock plummeted by a staggering 16%, eventually settling at an 8% decrease by 12:23 p.m. local time on Monday. The airline's parent company, AK Holdings, also experienced a sharp decline of up to 12%.

Political Turmoil and Financial Fallout

The nosedive in Jeju Air's shares mirrored the turbulent month faced by South Korea's stock market amidst political uncertainty. Following the impeachment of President Yoon Suk-yeol and subsequent appointment of acting president Han Duck-soo, the nation witnessed a swift transition of power. Deputy Prime Minister and Finance Minister Choi Sang-mok assumed the role of acting president, signaling a period of instability.

Yoon's brief declaration of martial law and Han's impeachment by the opposition further fueled the turmoil. Han's refusal to appoint three judges to the nine-member Constitutional Court, tasked with ruling on Yoon's removal, exacerbated the political crisis. Analysts fear a potential impeachment of Choi Sang-Mok if he fails to approve the new justices, prolonging the uncertainty.

Market Outlook and Projections

Despite the prevailing political tensions, South Korea's benchmark Kospi index showed a modest 0.4% increase at 12:23 p.m. local time, though it remains down by approximately 9% year-to-date. Analysts like Douglas Kim anticipate continued volatility in the country's markets throughout January, attributing the cautious stance of investors to the heightened political risks.

As the nation grapples with successive leadership changes and market fluctuations, the aftermath of the tragic plane crash underscores the interconnectedness of political events and financial realities in South Korea.

Original source: Business Insider

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By: htan@insider.com (Huileng Tan)
Title: Jeju Air Stock Plummets to All-Time Low Following Tragic Plane Crash
Sourced From: markets.businessinsider.com/news/stocks/jeju-air-shares-plane-crash-south-korea-markets-political-uncertainty-2024-12
Published Date: Mon, 30 Dec 2024 03:57:44 +0000