Yi Whan-woo is a Korea Times journalist primarily covering finance. He writes in-depth articles on macroeconomy and financial markets and previously covered sports, politics, diplomacy and inter-Korean affairs, among others. Feel free to contact him at yistory@koreatimes.co.kr.
Seoul stocks plunge over 7% due to Iran war, oil surge
A stock ticker at Hana Bank headquarters in central Seoul shows the benchmark KOSPI closing at 5,791.91 points, Tuesday, down 452.22 points, or 7.24 percent, from the previous session. Yonhap
By Yi Whan-woo
Won-dollar rate worsens to 1,466.1, biggest drop of 2026
The benchmark KOSPI lost more than 7 percent, Tuesday — the biggest fall in more than 18 months — amid heightened Middle East tensions following U.S.-Israeli strikes on Iran over the weekend.
The Korean currency also fell more than 26 won against the U.S. dollar in onshore trading, marking its steepest decline this year and fueling ongoing concerns that it could reach the worrisome 1,500-won level.
Seoul financial markets jittered as they reopened following a long weekend, joining other Asian markets that were hit by the Middle East conflict and fluctuating international oil prices, which climbed toward $80 per barrel.
KOSPI closed at 5,791.91 points, down 452.22 points, or 7.24 percent, from the previous session, Friday, before the U.S.-Israeli strikes on Iran. The pace of decline was the steepest since Aug. 5, 2024, when it fell 8.77 percent amid fears of a U.S. recession.
The main index started 1.26 percent lower at 6,165 points and, after briefly recovering above 6,180 points, saw the decline accelerate.
The steep fall triggered a sidecar trading curb as the KOSPI 200 futures index — a basket of the top 200 stocks — fell 5.09 percent from the previous session’s close around noon.
The decline exceeded the 5 percent threshold, triggering a temporary halt on program sell orders for five minutes before trading resumed.
This marked the first time in a month that the KOSPI sell-side sidecar had been triggered since Feb. 6.
The loss was driven by foreign and institutional investors, who net sold 5.14 trillion won ($3.5 billion) and 891 billion won in stocks, respectively, offsetting retail investors’ net purchases of 5.75 trillion won.
Among top market-cap stocks, Samsung Electronics fell 9.88 percent to 195,100 won, SK hynix retreated 11.5 percent to 939,000 won, and Hyundai Motor dropped 11.72 percent to 595,000 won.
Analysts attributed concerns over rising international oil prices and their adverse impact on the energy sector as the main downward factor for KOSPI.
According to Korea National Oil Corp.'s Opinet website, the prices of three crude oil benchmarks — Dubai, Brent and West Texas Intermediate — were $80.79, $77.74, and $71.23 per barrel, respectively. The prices rose each from $71.24, $71.28 and $67.02 on Friday.
“The course of the stock market is likely to depend mainly on fluctuations in oil prices,” said Lee Jae‑won, a researcher at Korea Investment & Securities.
He noted that Iran’s threat to block the Strait of Hormuz, a key international shipping route, adds to the concern.
The researcher noted that the threat sent oil and shipping stocks rising sharply, while weakening airline, chemical and steel stocks due to worries over rising fuel and raw material costs.
The Korean stock market suffered a biggger fall than its Asian peers, including Japan’s Nikkei, which lost 3.06 percent, and Hong Kong’s Hang Seng Index, which dropped 1.21 percent.
Analysts said that when KOSPI reopened after the long weekend, it reflected accumulated investor pessimism, triggering a wave of panic selling, while other Asian markets had been gradually adjusting since the previous day.
As for the Korean currency, it weakened by 26.4 won to close at 1,466.1 won on the dollar in onshore trading, snapping a two-day winning streak and marking its biggest loss this year.
Kim Do-eon, a researcher at Hana Securities, said, “The won’s weakening may persist, with the won-dollar exchange rate now heading toward the 1,480-won level.”