South Koreas Stock Market Plunges Amid Global Tensions Over Iran Conflict

South Korea’s Stock Market Sees Steep Decline Amid Global Economic Uncertainty

The benchmark KOSPI index plummeted by as much as 12.2 percent on Wednesday, marking one of the largest single-day declines in history. This drop surpassed the 12.02 percent plunge triggered by the September 11, 2001 attacks and the 9.44 percent fall seen during the 2008 financial crisis.

The decline followed a 7.2 percent drop in the KOSPI on Tuesday, cementing a two-day streak of losses that is considered one of the worst in decades. The losses were widespread, affecting major corporations such as Samsung Electronics, SK Hynix, and LG Electronics, as well as shipping and logistics firms.

The decline was largely attributed to the effective halt of traffic through the Strait of Hormuz, which carries approximately one-fifth of the world’s oil consumption. South Korea relies heavily on foreign oil and gas, with about 98 percent of its fossil fuel needs coming from overseas, according to the US Energy Information Administration.

Shares of several shipping companies, including Pan Ocean, HMM, and KSS Line, plummeted between 17 and 19 percent. The market’s decline is part of a broader trend of economic shockwaves triggered by the conflict in the Middle East.

In related news, US stocks also fell overnight, with the S&P500 and Nasdaq Composite both declining about 1 percent. The conflict in the region continued to escalate, with US and Israeli forces continuing their bombardment of Iran and Lebanon, while Tehran launched attacks on Israel and US allies in the Gulf region.

Source: Al Jazeera