South Korean stocks faced a significant decline on Monday morning as investors sold off major shares following Iran’s warning about potentially closing the Hormuz Strait indefinitely. The Korea Composite Stock Price Index (KOSPI) dropped by 5.08 percent to 5,487.36 by late morning. This decline led to the main bourse operator in the country temporarily halting program trading for five minutes.
The negative trend in the stock market was influenced by Iran’s response to U.S. President Donald Trump’s ultimatum regarding the Hormuz Strait. Iran’s threat to completely shut down the vital waterway, responsible for a significant portion of global oil supplies, raised concerns about potential energy price increases. This situation resulted in a broad decline in shares across various sectors in Seoul.
Notable companies like Samsung Electronics, SK hynix, Hyundai Motor, Hanwha Aerospace, and Naver experienced significant drops in their stock values. Additionally, the Korean won depreciated against the U.S. dollar, reaching its lowest level since the global financial crisis in 2009. The sell-side sidecar for the KOSPI was activated by South Korea’s main bourse operator, leading to a temporary trading halt due to a sharp plunge in the index.
