Korea Composite Index Drops as Strait of Hormuz Threat Intensifies

South Korean Stocks Plunge Over 5% as Strait of Hormuz Tensions Trigger Market Shock​

KOSPI Sees Sharp Selloff Amid Rising Geopolitical Risks​

Seoul, March 23: South Korean equities witnessed a steep decline on Monday morning, with the benchmark Korea Composite Stock Price Index (KOSPI) falling sharply as escalating tensions in the Middle East unsettled investors.

The KOSPI dropped 293.84 points, or 5.08 percent, to 5,487.36 as of 11:20 a.m., reflecting widespread selling across sectors. The index remained firmly in negative territory throughout the session.

Circuit Breaker Triggered as Volatility Surges​

The sharp downturn prompted the Korea Exchange (KRX) to activate a circuit breaker, temporarily halting program trading for five minutes. Program trading was suspended at 9:18 a.m. after the KOSPI 200 Futures index declined by 5 percent or more for at least one minute.

This marks the sixth instance this year that the exchange operator has triggered a circuit breaker, highlighting heightened market volatility.

Iran Strait Warning Sparks Global Market Concerns​

Investor sentiment weakened following Iran’s warning that it could indefinitely close the Strait of Hormuz, a critical global oil transit route handling around one-fifth of the world’s oil supply.

The warning came after Tehran rejected an ultimatum from U.S. President Donald Trump, who had indicated that the United States could target Iran’s power plants if the waterway was not reopened by Monday evening.

The escalating standoff has intensified concerns over potential disruptions to global energy supplies and a possible surge in oil prices.

Heavy Losses Across Major South Korean Stocks​

Losses were broad-based across the South Korean market, with major blue-chip stocks recording significant declines.

Samsung Electronics fell 4.96 percent, while SK Hynix dropped 5.46 percent. Hyundai Motor declined 5.03 percent, Hanwha Aerospace slipped 5.15 percent, and Naver lost 4.74 percent.

Korean Won Weakens to Multi-Year Low​

The South Korean won also came under pressure, trading at 1,509.5 against the U.S. dollar, weakening by 8.9 won from the previous session.

The currency touched its lowest level since March 10, 2009, when it stood at 1,511.1 during the global financial crisis, reflecting heightened risk aversion in financial markets.

Market Outlook Remains Cautious​

The ongoing geopolitical tensions and concerns over global energy supply disruptions continue to weigh on investor sentiment, keeping South Korean financial markets under pressure.