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Seoul Stocks Plunge 5% as Iran Threatens to Close Key Oil Strait

South Korean stocks suffered a sharp sell-off, with the KOSPI index dropping over 5% and triggering a temporary halt to program trading. The plunge was driven by escalating tensions in the Middle East after Iran threatened to completely close the Strait of Hormuz in response to a U.S. ultimatum. Major South Korean companies like Samsung Electronics and Hyundai Motor saw losses of around 5%, while the Korean won fell to its lowest level against the dollar since the 2009 financial crisis. The market turmoil reflects deep investor concern over potential global energy supply disruptions and further price hikes.

Key Points: South Korea Stocks Crash Amid Iran-US Strait Tensions

  • KOSPI plunged over 5%
  • Trading halted for 5 minutes
  • Iran threatens Strait of Hormuz closure
  • Energy price hike fears spike
  • Korean won hits 2009 low
2 min read

Seoul shares sharply down amid escalating Mideast turmoil

KOSPI plunges over 5%, triggering trading halt as Iran's threat to close the Strait of Hormuz sparks global market panic and energy fears.

"Iran hit back, saying it could completely close the crucial waterway, which handles around one-fifth of global oil supplies."

Seoul, March 23

South Korean stocks were trading sharply lower on late Monday morning, as investors offloaded major shares after Iran warned it could close the Hormuz Strait indefinitely.

The benchmark Korea Composite Stock Price Index (KOSPI) declined 293.84 points, or 5.08 percent, to 5,487.36 as of 11:20 a.m.

The index remained in negative territory, triggering the country's main bourse operator to temporarily halt program trading for five minutes, reports Yonhap news agency.

On Friday, major stock indexes on Wall Street closed lower, after Tehran dismissed U.S. President Donald Trump's ultimatum that the United States could hit Iran's power plants if the Hormuz Strait is not reopened by Monday evening.

Iran hit back, saying it could completely close the crucial waterway, which handles around one-fifth of global oil supplies.

Such a back-and-forth between the two countries raised concerns of further energy price hikes.

In Seoul, shares were in negative territory across the board.

Market top-cap Samsung Electronics lost 4.96 percent, while its rival SK hynix fell 5.46 percent.

Top carmaker Hyundai Motor dipped 5.03 percent, defence giant Hanwha Aerospace shed 5.15 percent, and portal operator Naver went down 4.74 percent.

The Korean won was trading at 1,509.5 won against the U.S. dollar, down 8.9 won from the previous session. It marked the lowest level since March 10, 2009, when it hit 1,511.1 won during the global financial crisis.

South Korea's main bourse operator issued a sell-side sidecar for the benchmark Korea Composite Stock Price Index (KOSPI), temporarily halting trading after a sharp plunge.

Program trading for the KOSPI was suspended for five minutes at 9:18 a.m. according to the Korea Exchange (KRX).

A sell-side sidecar is triggered when the KOSPI 200 Futures index dips 5 percent or more for at least one minute.

It marks the sixth time for the bourse operator to issue a sell-side sidecar this year.

- IANS

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Reader Comments

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Priya S
A 5% drop is massive! It shows how fragile investor confidence is. While the article focuses on South Korea, we in India should pay close attention. Many of our IT and manufacturing companies have significant exposure to Korean and global markets. Our RBI and Finance Ministry must be watching this closely to manage any potential impact on the rupee and inflation.
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Aman W
Honestly, this constant geopolitical tension is exhausting for the common person. First, it affects global supply chains, then oil, then stock markets, and finally it hits our wallets. I hope our government has a strategic oil reserve plan activated. We cannot afford another fuel price hike right now.
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Sarah B
From an investment perspective, this is a classic risk-off event. Money is fleeing equities for safer assets. It's interesting to see defence stocks like Hanwha also falling—usually they rise on war fears. Maybe the market is pricing in a broader economic slowdown which would hurt all sectors, including defence. Time to review my portfolio.
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Vikram M
The Korean won hitting levels last seen during the 2009 financial crisis is very alarming. It shows the sheer scale of capital flight. While India's economy is more domestically driven, we are not immune. Our policymakers should use this as a case study to strengthen our financial buffers. Jai Hind.
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Karthik V
A respectful criticism: The article is very factual about the market drop but doesn't delve enough into the human impact. What does this mean for the average South Korean saver or employee? Similarly, for us in India, beyond the stock tickers, how will this affect jobs and small businesses if a full

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