Seoul Stocks Plunge Over 6%, Triggering Sidecar
The South Korean won plummeted to a 17-year low against the US dollar on Monday, exceeding 1,510 per dollar, as heightened tensions in the Middle East sent shockwaves through global financial markets.
As of 9:42 a.m. KST, the won was trading at 1,510.3 against the dollar, a decrease of 9.7 won from the previous Friday’s closing price. Following an opening rate of 1,504.9, it further depreciated to 1,511.8 in morning trading – marking its weakest valuation against the dollar since March 10, 2009, when it reached 1,561 won.
The Korean currency had already closed above the 1,500 mark for two consecutive sessions and extended its downward trend at the beginning of the new week.
These market movements occurred as investors prepared for sustained market pressure due to surging oil prices and escalating geopolitical risks, driven by intensifying tensions between the US and Iran.
The dollar index, which gauges the US currency’s strength against six major currencies, increased by 0.29 percent from the previous session, reaching 99.695.
South Korean stocks also experienced significant downward pressure. The benchmark Kospi index opened down 3.48 percent at 5,580 on Monday. Losses deepened to over 6 percent in early trading, triggering a sell-side sidecar at approximately 9:18 a.m. KST. This halted program trading for five minutes after Kospi 200 futures fell by more than 5 percent for over a minute.
By 10:20 a.m. KST, the Kospi was down 5.4 percent at 5,468, with foreign investors and institutional investors selling off 1.7 trillion won ($1.13 billion) and 1.8 trillion won worth of shares, respectively.
The secondary Kosdaq index also fell sharply, declining as much as 5 percent and trading down about 4 percent at 1,115.
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