As tensions between China and Japan intensify, Korea's tourism stocks are rising on the 18th. The gains appear to be driven by expectations of a spillover benefit from a potential increase in Chinese tourists visiting Korea.

In the afternoon on the 31st, a tourist visiting Gyeongju walks down Hwangridan-gil wearing a gat and dressed in hanbok. Hwangridan-gil combines Gyeongju's Hwangnam-dong and Seoul's Itaewon Gyeongnidan-gil to mean the Gyeongnidan-gil of Hwangnam-dong. It gains popularity as a hot spot with diverse offerings, including snacks such as ten-won bread, Cheomseongdae bread, and jjondeugi, as well as eateries, cafes, restaurants, souvenir shops, hanbok rental shops, photo studios, and tarot and saju cafes. /Courtesy of News1

As of 11:27 a.m. on the day, Yellow Balloon Tour shares on the KOSDAQ were trading at 5,500 won, up 9.56% (480 won) from the previous session. Very Good Tour was up 3.70% (220 won) at 6,160 won from the prior day.

Hotel and casino stocks are also rising in tandem. GS PNL, which owns the five-star hotel "Grand InterContinental Seoul Parnas," is trading at 48,875 won, up 10.70% (47,250 won) from the previous session.

Seobu T&D, which operates hotel units including Yongsan Dragon City Hotel, is also up 6.60% (680 won) to 10,980 won from the previous day.

Lotte Tour Development, which operates a foreigners-only casino, is up in the 1% range, and Paradise is also up in the 2% range.

Hyundai Department Store, a destination for foreign tourists, and Shinsegae, which has a duty-free unit, are also showing gains in the 2% range.

It is interpreted that investor sentiment has gathered on expectations that Korea's tourism stocks will benefit as China-Japan relations have recently deteriorated.

Earlier, Japan Prime Minister Sanae Takaichi said, "If China launches a military attack on Taiwan, it could constitute a 'survival-threatening situation' for Japan," sending China-Japan relations into a rapid chill.

China's Ministry of Foreign Affairs has immediately pushed back, advising Chinese citizens to refrain from traveling to Japan. It also repeatedly urged Japan to "stop playing with fire and withdraw wrongful words and deeds."

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