Seoul’s benchmark stock market experienced a sharp decline on Monday as intensifying uncertainty surrounding US-Iran peace negotiations cast a shadow over global markets. US President Donald Trump’s renewed threats against Tehran fueled investor apprehension, pushing South Korean equities into negative territory from the open.
The Korea Composite Stock Price Index (KOSPI), the nation’s leading benchmark, dropped significantly by 124.2 points, marking a 1.37 percent decrease to 8,928.2 within the initial 15 minutes of Monday’s trading session. This KOSPI decline reflected broad market anxiety.
The fragile US-Iran negotiations, which commenced in Switzerland overnight, faced an immediate setback. Iran abruptly halted diplomatic talks following a stern warning from President Trump, who threatened military strikes on Iran should the Hezbollah militant group persist with its attacks against Israel. This development significantly heightened geopolitical tensions.
Adding to the regional instability, Tehran had previously warned of closing the crucial Strait of Hormuz. This threat was issued in response to Israel’s ongoing military operations in Lebanon targeting the Iranian-backed Hezbollah militant group, despite a provisional 60-day agreement designed to cease hostilities on all fronts. The potential disruption to global oil supplies further intensified market concerns.
Back in Seoul’s equities market, the weak opening was primarily driven by underperformance from major market heavyweights and blue-chip companies, signaling broad investor caution.
Market bellwether Samsung Electronics saw its shares fall 2.68 percent, reflecting the wider market downturn. Fellow semiconductor giant SK hynix also experienced a decline, albeit a more modest 0.07 percent, as tech stocks reacted to the uncertain economic climate.
Further illustrating the market’s struggles, top automaker Hyundai Motor’s stock retreated 3.92 percent. In the shipbuilding sector, Hanwha Ocean, a significant industry player, tumbled a substantial 7.87 percent. Additionally, Samsung Electro-Mechanics, an electronic components manufacturing affiliate closely linked to Samsung Electronics, recorded a 0.93 percent drop in its share price, underscoring the widespread negative sentiment.
