South Korea ETF Falls 1.29% Post-Tariff Ruling, AI Memory Risks Loom
iShares MSCI South Korea ETF fell 1.29% after the Supreme Court voided IEEPA tariffs and Trump imposed a 15% global surcharge, leaving South Korea’s U.S. tariff rate unchanged; EWY has climbed 45.10% year-to-date. A Micron analysis warned AI-driven memory demand may weaken, posing risks for Korean chip exporters.
1. Supreme Court Voids IEEPA Tariffs and Imposes Global Surcharge
The Supreme Court’s 6-3 decision invalidated tariffs imposed under the International Emergency Economic Powers Act, prompting a 15% global tariff under Section 122 of the Trade Act of 1974 through July 24. This move reduces the net U.S. tariff increase since early 2025 to 9 percentage points while leaving South Korea’s effective rate essentially unchanged.
2. EWY Reaction and Year-to-Date Performance
iShares MSCI South Korea ETF declined 1.29% on the day of the ruling but retains its position as the leading U.S.-listed country ETF with a 45.10% gain so far in 2026. The ETF’s large exposure to technology exporters makes it particularly sensitive to shifts in U.S. trade policy and global demand.
3. Micron’s AI Memory Demand Warning
A recent Micron briefing cautioned that AI-driven memory demand could falter if order growth slows, risking inventory gluts. Given South Korean chipmakers’ prominent weighting in EWY, any downturn in memory orders could exert downward pressure on the ETF’s technology segment.