South Korean stocks experienced a significant drop of around 8% on Monday morning as the Korea Exchange (KRX) resumed trading following a 20-minute suspension due to extreme volatility caused by recent US-Israeli strikes on Iran. The benchmark Korea Composite Stock Price Index (KOSPI) fell by 7.98% to 5,138.99.
The KRX activated a circuit breaker after the KOSPI plummeted 8.11% to 5,132.07, leading to a 20-minute trading halt. Circuit breakers are triggered when the index drops 8% below the previous session’s level for one minute.
Last week, the KRX also implemented a circuit breaker when the main index crashed by 12.06%, the largest one-day decline since September 11, 2001, following the September 11 terrorist attacks in the US. Investors were closely monitoring global energy price volatility, particularly with the US benchmark West Texas Intermediate (WTI) crude surpassing $100 per barrel.
In response to weaker-than-expected US jobs data and the global market situation, South Korean oil refiners and financial shares were affected. Companies like SK Innovation, S-Oil, Samsung Electronics, SK hynix, KB Financial, Shinhan Financial, Hanwha Aerospace, and Hanwha Ocean experienced fluctuations in their stock prices.
POSCO International, a trading firm, saw an 11.06% increase in its stock value as investors showed optimism towards the firm’s energy business portfolio. The Korean won was trading at 1,497.3 won against the US dollar, down by 20.9 won from the previous session.
