Seoul’s stock market opened significantly lower today, as investors engaged in widespread profit-taking in technology stocks. This sharp decline was predominantly fueled by renewed concerns over the escalating conflict in the Middle East and its potential global economic impact.
The benchmark Korea Composite Stock Price Index (KOSPI) plummeted, initially falling 4.45 percent before extending its losses. By 9:15 a.m., the KOSPI was down 383.87 points, or 5.27 percent, trading at 6,900.54, indicating a substantial market correction.
In response to the rapid downturn, the Korea Exchange, the nation’s stock market operator, activated a 20-minute sell-side sidecar for the KOSPI around 9:10 a.m. This circuit breaker was triggered after the benchmark index’s fall exceeded the 5 percent threshold, aiming to stabilize the market.
This sharp decline contrasts starkly with Wednesday’s performance, when the KOSPI surged by 6.24 percent. That previous day’s rally was driven by softer-than-expected US inflation data, which had momentarily eased immediate concerns about potential Federal Reserve interest rate hikes.
Overnight, Wall Street presented a mixed picture: the Dow Jones Industrial Average recorded a modest gain of 0.29 percent, closing at 52,658.64. However, the tech-heavy Nasdaq Composite declined by 0.62 percent, settling at 26,269.23.
These mixed results in the US were partly influenced by reemerging concerns surrounding artificial intelligence (AI), which led to a downturn in several major AI-related tech stocks on Wall Street.
Meanwhile, geopolitical tensions intensified with the United States launching fresh strikes on Iran on Wednesday. The escalating Middle East conflict has reignited anxieties about global energy supplies from the region, significantly impacting market sentiment worldwide.
Within the Seoul market, technology stocks were at the forefront of the decline, experiencing significant losses as investors pulled back from riskier assets.
Market bellwether Samsung Electronics saw its shares plunge by 6.98 percent, while chipmaking rival SK Hynix experienced an even steeper fall of 10.18 percent. Other significant losses included top carmaker Hyundai Motor, down 3.46 percent, and defense contractor Hanwha Aerospace, which declined 0.32 percent.
Despite the broad market downturn, a few select stocks managed to post gains. Shipbuilder Hanwha Ocean rose 2.2 percent, and shipping firm HMM climbed 1 percent, demonstrating resilience in specific sectors.
