Seoul stocks experienced a significant surge on Tuesday, fueled by growing optimism surrounding a potential de-escalation of tensions between the US and Iran. The Korean won also saw a notable appreciation against the US dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) closed at 5,553.92, marking a substantial increase of 148.18 points, or 2.74 percent. The index reached an intraday high of 5,643.00 during the trading session.
This rebound follows Monday’s sharp decline of over 6 percent, triggered by escalating geopolitical tensions in the Middle East.
Trading volume remained moderate, with 1.2 billion shares changing hands, amounting to a value of 24.5 trillion won (US$16.39 billion). The market breadth was positive, with 705 stocks advancing and 190 declining.
Foreign investors were net sellers, offloading 2 trillion won worth of shares. Conversely, institutional and retail investors collectively purchased a net total of 1.7 trillion won.
“The stock market surged on Trump’s TACO but reduced gains amid persisting geopolitical uncertainties,” commented Lee Kyoung-min, an analyst from Daishin Securities, using the acronym “TACO” to refer to “Trump Always Chickens Out.”
Earlier in the week, former President Trump had issued threats to target Iranian power plants if Tehran failed to reopen the Strait of Hormuz by Monday evening. However, he subsequently announced a postponement of this plan, indicating that the United States was engaged in “good talks” with Iran.
Despite the positive signals, investors remained cautious due to lingering geopolitical uncertainties, as Iran denied engaging in talks with the US, and the critical oil waterway, the Strait of Hormuz, remained effectively closed, Lee added.
Most major market players recorded gains during the trading session.
Leading chip manufacturer Samsung Electronics saw its shares rise by 1.44 percent to 189,700 won, while its competitor SK hynix experienced a significant surge of 5.68 percent to 986,000 won.
Automotive giant Hyundai Motor advanced by 1.44 percent to 492,000 won, battery manufacturer LG Energy Solution jumped by 10.25 percent to 392,500 won, and defense industry leader Hanwha Aerospace increased by 4.46 percent to 1,335,000 won.
On the losing side, nuclear power plant builder Doosan Enerbility fell by 0.6 percent to 100,100 won, and brokerage firm Mirae Asset Securities declined by 1.29 percent to 61,100 won.
