South Korea

Kim Jong Un supervised the launch of sea-to-surface ‘strategic cruise missiles’ from country’s new naval destroyer.

North Korean leader Kim Jong Un has overseen the test-firing of “strategic cruise missiles” from a new 5,000-tonne naval destroyer before the vessel’s official commissioning, according to state media.

Kim supervised the launch of sea-to-surface missiles from the destroyer Choe Hyon on Wednesday, assessing the test as a “core” element of the new warship’s capabilities, which he described as a “new symbol of sea defence” for his country.

Calling for the production of more warships of a similar class or better, Kim said his navy’s adoption of nuclear weapons was making progress.

“Our Navy’s forces for attacking from under and above water will grow rapidly. The arming of the Navy with nuclear weapons is making satisfactory progress,” Kim said at the Nampo Shipyard in the west of the country, according to North Korea’s official Korean Central News Agency (KCNA).

“All these successes constitute a radical change in defending our maritime sovereignty, something that we have not achieved for half a century,” he said.

South Korea’s official Yonhap news agency noted that North Korea uses references to “strategic” weapons to indicate they could have nuclear capabilities.

According to KCNA, over a two-day visit to the shipyard, spanning Tuesday and Wednesday, Kim inspected the Choe Hyon, the lead vessel in a new series of 5,000-tonne “Choe Hyon-class” destroyers currently under construction in North Korea.

‘Wage a more active and persistent struggle’

In May 2025, North Korea’s ambitious naval modernisation programme suffered a major setback when a second Choe Hyon-class destroyer capsized during a botched side-launch ceremony at Chongjin Shipyard, an incident witnessed by the Korean leader.

Later, and in a rare admission of failure, KCNA reported that a launch mechanism malfunction caused the stern of the 5,000-tonne destroyer to slide prematurely into the water. The accident crushed parts of the hull and left the bow stranded on the shipway.

At the time, Kim characterised the launch failure as a “criminal act”, blaming the incident on “absolute carelessness” and “irresponsibility” across multiple state institutions.

This week’s missile tests come after the North Korean leader pledged in late February to lift living standards as he opened a rare congress of the governing Workers’ Party, held once every five years.

Kim told the congress that the ruling party was “faced with heavy and urgent historic tasks of boosting economic construction and the people’s standard of living”.

“This requires us to wage a more active and persistent struggle without allowing even a moment’s standstill or stagnation,” he said.

North Korea has prioritised nuclear weapons development and military strength above all else, claiming that it must be militarily strong to resist pressure from the United States and its ally, South Korea.

Since taking power in late 2011, Kim has maintained the military as a core priority while simultaneously emphasising economic strengthening to address the country’s chronic impoverishment.

Emerging markets are roaring back in 2026, staging a rally that has surprised investors not only for its speed — unmatched in decades — but also for the broader global context in which it is unfolding.

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While US software stocks reel from artificial intelligence disruption fears and the S&P 500 remains broadly flat year-to-date, emerging markets are decoupling.

In a reversal of long-standing market dynamics, the asset class is briefly playing an unexpected role: that of a relative safe haven.

The rally is broad, persistent and increasingly supported by flows, macro conditions and structural shifts in global trade.

Emerging markets dominate global performance rankings

Data from CountryETFTracker show that the five best-performing country-specific exchange traded funds so far this year all belong to emerging markets.

Leading the rally is South Korea’s iShares MSCI South Korea ETF (EWY), up 43.28% year-to-date after a 96% surge in 2025.

The gains reflect the dominance of chipmakers such as Samsung Electronics and SK Hynix, which are benefiting from strong global demand for AI-related memory and advanced semiconductors, lifting exports and corporate earnings.

It is followed by Peru’s iShares MSCI Peru ETF (EPU), which has gained 25.31%, Brazil’s iShares MSCI Brazil ETF (EWZ) at 22.03%, Thailand (THD) at 21.38% and Turkey (TUR) at 21.32%.

The broader MSCI Emerging Markets Index, tracked by the iShares MSCI Emerging Index Fund (EEM), is up nearly 13% year-to-date.

Two elements stand out here: the scale of the relative strength and the remarkable consistency of the rally.

Over the past two months, EEM has achieved the strongest relative surge against the S&P 500 since 2008. Over 12 months, the performance gap has widened to 25 percentage points — the largest divergence since January 2010.

Emerging markets have also recorded 13 positive months out of the last 14 and closed higher for nine consecutive weeks — a streak not seen since 2005.

There is, unmistakably, a structural trend under way.

Record inflows toward geographic capital reallocation

The rally is not only price-driven but also flow-driven.

The iShares MSCI Emerging Markets ETF attracted more than $4bn (€3.7bn) in January 2026, its strongest month for inflows since 2015.

South Korea alone drew $1.6bn (€1.5bn) in January and over $1bn (€0.9bn) in February, while Brazil attracted nearly $1bn (€0.9bn) in January.

The surge in allocations suggests that institutional investors are actively increasing exposure to emerging markets.

Importantly, flows appear broad-based rather than concentrated in a single thematic trade.

While Asia-focused markets have benefited from AI supply-chain positioning, Latin American funds have drawn support from commodities and cyclical exposure.

Why is this happening?

1) Rotation away from crowded US tech

Much of 2026’s market narrative has centred on artificial intelligence disruption, particularly in long-duration US software stocks.

After years of heavy concentration in mega-cap American technology names, investors are reassessing exposure as valuations look stretched and volatility rises.

Emerging markets, by contrast, began the year trading at sizeable discounts to developed peers.

Capital is rotating away from crowded US growth trades into cyclicals, commodities and regions directly exposed to AI hardware demand.

Ed Yardeni of Yardeni Research highlighted that while the US economy still remains exceptional, emerging economies benefit from expanding middle classes, rising industrial output and export growth that increasingly outpaces advanced economies.

2) Dollar weakness supports emerging markets

Currency dynamics are reinforcing the move towards emerging markets.

Jeff Buchbinder, Chief Equity Strategist at LPL Financial, indicates that the US Dollar Index is close to breaking its long-term uptrend, with expectations of further Federal Reserve rate cuts adding pressure.

Central banks’ gradual diversification away from the US dollar towards gold, alongside a persistent US trade deficit that continues to expand the global supply of dollars, is also exerting downward pressure on the greenback.

For emerging markets, a softer dollar eases financing conditions and improves relative returns.

Bank of America strategist David Hauner describes the near-certainty of the next Fed move being a cut as a ‘volatility compressor’ — a backdrop that has historically supported EM assets.

3) AI hardware boom supports Asia

While AI concerns weigh on US software, the hardware backbone of artificial intelligence is largely produced in Asia.

Taiwan dominates advanced semiconductor production, and South Korea’s Samsung Electronics remains a global leader in memory chips.

In Taiwan, technology-related goods now account for roughly 80% of exports and the bulk of recent growth. Revenue at TSMC continues to track the island’s export momentum, with analysts expecting another year of solid expansion in 2026.

4) Commodities and cyclicals add further support

The strength is not confined to technology exporters. Commodity-linked economies such as Brazil and Peru are benefiting from firm metals and agricultural demand, while Thailand and Turkey are gaining from improved financial conditions and cyclical recovery dynamics.

Against a backdrop of stabilising global growth and easing US monetary policy expectations, emerging markets combining export momentum with improving external balances are regaining investor attention.

Why this matters

The resurgence of emerging markets is more than a short-term performance story.

After a decade dominated by US exceptionalism, the current rally points to a potential broadening of global leadership — driven by currency dynamics, shifting capital flows and the geography of AI-driven production.

If sustained, the move could reshape portfolio allocations and challenge the long-standing concentration of global equity returns in a narrow group of US mega-cap stocks.

South Korea and Brazil have agreed to significantly deepen cooperation across key minerals, trade, technology and security, as President Lee Jae Myung hosted Brazilian President Luiz Inácio Lula da Silva in Seoul for the first Brazilian state visit in more than two decades. The summit, held at the Blue House, marked a symbolic reset in bilateral ties and produced an ambitious roadmap aimed at elevating relations to a strategic partnership.

The two leaders endorsed a four-year action plan designed to anchor cooperation in strategic minerals, advanced manufacturing, defence, space industries and food security. They also oversaw the signing of 10 memorandums of understanding covering trade and industrial policy, rare earths and other critical minerals, the digital economy including artificial intelligence, biotechnology and health, agricultural collaboration, small-business exchanges, and joint efforts to combat cybercrime and narcotics trafficking.

Critical Minerals at the Core

At the heart of the agreement lies a shared recognition of the growing geopolitical importance of critical minerals. Brazil holds significant reserves of rare earth elements and nickel, both essential to electric vehicles, renewable energy systems and high-tech manufacturing. South Korea, a manufacturing powerhouse heavily reliant on imported raw materials, is seeking to diversify supply chains amid intensifying global competition for resource security.

For Seoul, closer ties with Brasília offer an opportunity to secure stable access to strategic inputs while reducing exposure to concentrated supply routes. For Brazil, the partnership represents a chance to attract South Korean investment into mining, processing and downstream industries, potentially moving up the value chain rather than remaining primarily a raw-material exporter.

Trade Expansion and Industrial Policy Alignment

Brazil is South Korea’s largest trading partner in South America, and both governments signaled an intent to broaden the scope of commerce beyond traditional commodity flows. Industrial policy coordination featured prominently in the discussions, suggesting a shift toward co-development in sectors such as semiconductors, batteries and green technologies.

The emphasis on the digital economy and artificial intelligence reflects a convergence of economic strategies. South Korea’s advanced technological ecosystem complements Brazil’s expanding digital market, creating potential for joint ventures and technology transfers. Cooperation in biotech and health also indicates a recognition of demographic and public health challenges that transcend borders.

Security, Stability and Shared Democratic Narratives

Beyond economics, the leaders framed their partnership within a broader narrative of stability and democratic resilience. Lee emphasized support for peace on the Korean Peninsula, while Lula underscored Brazil’s interest in a balanced and rules-based international order.

Their personal rapport, shaped by shared experiences of early-life factory work and social mobility, added a human dimension to the diplomacy. Lee publicly praised Lula’s life story as emblematic of democratic progress, reinforcing a symbolic alignment that may help sustain political goodwill between the two administrations.

The inclusion of joint policing initiatives against cybercrime and transnational threats signals that the partnership extends into non-traditional security domains. As digital connectivity deepens, cyber resilience and coordinated law enforcement become integral to safeguarding economic integration.

Strategic Diversification in a Fragmented World

The timing of the summit is notable. As global trade faces renewed uncertainty and supply chains continue to recalibrate, middle powers such as South Korea and Brazil are seeking to hedge against volatility by strengthening bilateral and regional ties. By formalizing cooperation in minerals, technology and defence, both governments aim to insulate their economies from external shocks while positioning themselves within emerging industrial ecosystems.

The ceremonial elements of the visit including a state banquet blending Korean and Brazilian cultural traditions underscored the leaders’ intent to broaden engagement beyond transactional trade. Whether the newly signed agreements translate into measurable investment flows and industrial integration will depend on sustained political commitment and private-sector participation. Yet the framework established in Seoul suggests that both countries see strategic partnership not as a symbolic upgrade, but as a practical response to an increasingly fragmented global landscape.

With information from Reuters.

Kim focuses on improving economic activity in opening speech at Ninth Congress of the Workers’ Party of Korea.

North Korea has kicked off a rare party congress of the ruling Workers’ Party, held once every five years, that will see the leadership in Pyongyang set major policy goals in defence, diplomacy and the economy, state media reports.

The Korean Central News Agency (KCNA) said on Friday that the Ninth Congress of the Workers’ Party of Korea (WPK) was under way, marking the start of the country’s most consequential political event since 2021.

“The Ninth Congress of the WPK opened with splendour in Pyongyang, the capital city of the revolution,” KCNA said, reporting that the high-level meeting started on Thursday and observers say it is expected to run for several days.

South Korea’s official Yonhap News Agency said the gathering will be closely followed for any signs regarding North Korea’s development of nuclear weapons or overtures towards the administrations in Seoul and the United States, which the North considers its chief foes.

Yonhap reports that North Korea’s leader, Kim Jong Un, made no mention of relations with either South Korea or the US in his opening speech to the congress on Thursday and, instead, focused on boosting the country’s economy.

“Ahead of our party are heavy and urgent tasks of advancing economic development and improving people’s livelihoods, and transforming all aspects of social life in the country as quickly as possible,” Kim said, according to KCNA.

While the true state of North Korea’s often struggling economy is hard to gauge, The Associated Press news agency reports that outside experts suggest the country has seen a gradual recovery in economic activity, helped by a post-COVID boost in trade with China and the export of weapons to help Russia in its war against Ukraine.

Several thousand North Korean troops have fought on Moscow’s side against Ukraine, and Pyongyang is believed to have exported large amounts of ammunition to help the Russian invasion of its neighbour.

North Korea’s ‘biggest enemy’

South Korea’s spy agency said last week it was monitoring the congress for any sign that Kim will officially designate his teenage daughter, Kim Ju Ae, as his potential successor, formalising her position as heir apparent in a fourth-generation succession of the Kim family as North Korea’s leaders.

At the previous party congress five years ago, Kim declared that the US was his nation’s “biggest enemy”, the AFP news agency reports, and there is deep interest in whether the North Korean leader will soften his rhetoric – or double down – at this year’s congress, particularly amid the US presidency of Donald Trump.

Trump – who met Kim in 2019 when he briefly stepped foot into North Korea to shake Kim’s hand and pose for photos – said during a tour of Asia late last year that he was “100 percent” open to meeting Kim again.

So far, Kim has demurred on Trump’s overtures to meet again.

Observers of North Korean politics are reported to be scouring satellite imagery for any signs of the vast military parades that have accompanied previous congress meetings in Pyongyang.

Such parades will be closely watched for signs of a shift in North Korea’s weapons capabilities, as the country has used previous processions to show off its newest and most advanced weapons.

Kim held a ceremony on Thursday to unveil the deployment of 50 new launch vehicles for nuclear-capable short-range missiles as the congress kicked off.

According to Yonhap, the congress brings together some 5,000 party representatives from across the country, including 200 senior officials from the WPK’s headquarters. More than 4,700 officials from regional and industrial sectors are also in attendance.

MILAN — Chloe Kim came up short in her attempt to become the first person to win three consecutive Olympic snowboarding gold medals on Thursday, finishing second in the halfpipe to South Korea’s Gaon Choi at Livigno Snow Park.

Choi stormed back from a nasty crash on her first run in which she clipped the lip of the halfpipe and came tumbling almost head first onto the icy surface. She looked shaky on her second run then the 17-year-old who leads the World Cup standings threw down a near flawless 90.25-point run while fresh snow fell to jump ahead of Kim, who had 88 points on her first run.

Dropping in last as the top qualifier, Kim had a chance to grab the gold medal back. She flashed two thumbs up to her coaching team before dropping in. But she fell on a cab double cork 1080, which she had stomped in her first two runs.

At the bottom of the halfpipe, Choi threw her arms in the air. Her coach ran to hug her. Kim, after sliding to the bottom of the pipe, ran through the crowd to congratulate Choi. The new Olympic champion was celebrating with Kim’s family.

The snowboard stars have history. Kim helped Choi train at Mammoth Mountain Snowboarding Club. Choi counts Kim among one of her snowboarding idols after Kim launched herself to superstardom at the 2018 Olympics.

Kim, then 17, became the youngest woman to win an Olympic snowboarding gold medal in PyeongChang. She followed it up with a historic gold in Beijing, where she became the first woman to win two Olympic gold medals in halfpipe.

The 25-year-old Kim suffered a torn labrum in her right shoulder in early January while training in Switzerland. It was the second time she had injured her shoulder in less than four weeks after she was forced to withdraw from a World Cup competition in December.

The injury meant the Olympics were Kim’s first competition of the season.

Little is known about Kim’s daughter, Ju Ae, who made her first public appearance in 2022 but appears set to be her father’s successor.

South Korea’s spy agency believes that North Korean leader Kim Jong Un is preparing to designate his daughter, Kim Ju Ae, as his successor, increasing the agency’s earlier assessment of the teenager being the “most likely successor”.

The National Intelligence Service in Seoul informed legislators of the news during a closed-door briefing on Thursday, according to South Korea’s official Yonhap News Agency. Their intelligence agency’s findings were later shared with the media by South Korean politicians Park Seon-won and Lee Seong-gwon.

“Kim Ju Ae’s presence continues to be highlighted at events such as the recent Armed Forces Day ceremony and her visit to the Kumsusan Palace of the Sun, and there are even signs that she is expressing opinions on some policies,” Lee told reporters, according to Yonhap.

“We believe that she has now entered the succession selection stage,” Lee said.

Kumsusan Palace of the Sun is considered one of the most important places in North Korea as the final resting place of the country’s Great Leader Kim Il Sung and his son Dear Leader Kim Jong Il – the current Kim’s grandfather and father, and Ju Ae’s great-grandfather and grandfather.

Yonhap reports that if Ju Ae attends or receives a title at the ruling Workers’ Party congress later this month, a key political event that analysts believe will see major policy goals unveiled, speculation about her path to succession will “gain traction”.

Very little is known about Kim’s daughter, including her official age, though she is believed to still be in her teens.

Her first public appearance was in 2022 at the test launch of a North Korean intercontinental ballistic missile, and she has been photographed alongside her father at numerous events across the country since then.

In January, she was photographed by Pyongyang’s Korean Central News Agency attending the test launch of a large-calibre multiple-rocket launch system alongside her father.

She also travelled by armour-plated train with her father to Beijing in September to attend a military parade marking 80 years since Japan’s surrender at the end of World War II, where she would have mixed with both Chinese and Russian leaders.

Seoul’s spy agency also said that Kim is currently directing the development of a large submarine ‌that is likely capable of carrying up to 10 submarine-launched ballistic missiles and which may be designed to be powered by a ‌nuclear ‌reactor, according to the politicians Park and Lee.