The KOSPI index opened down nearly 5%. As the Iran war appears to be dragging on, investor sentiment toward risk assets has slumped sharply. While stock indexes are plunging, the won also tumbled.
On the 30th, the KOSPI index started trading at 5,181.80, down 257.07 points (4.73%) from the previous session. Foreigners and institutions are net sellers, with individuals the only net buyers. Foreign investors are also on the sell side in KOSPI 200 futures. In early trading, the index's decline widened to more than 5%. As of 9:20 a.m., the index was down 3%–4%.
Top market-cap stocks are falling across the board. In particular, large semiconductor stocks that had led the market's gains are seeing steep declines. Defense, shipbuilding, nuclear power, and financial shares are also falling.
Over the weekend, U.S. stocks also closed lower across the board. As the Iran war, once expected to end, showed signs of escalating, risk-off sentiment grew. News emerged that the United States and Israel carried out airstrikes on Iran's nuclear and steel facilities. There were also projections that the U.S. administration could deploy ground troops to Iran.
In addition, Yemen's pro-Iran Islamist armed group Houthis bombed Israel on the 28th and declared it would enter the Iran war. Analysts also said that if, beyond the already-blockaded Strait of Hormuz, the Houthis were to block the Bab el-Mandeb Strait, a Middle East oil route, the global economy could suffer a catastrophic blow.
As the Iran war drags on, international crude prices have risen again, and concerns are growing that this could drive up expenses across Korea's manufacturing sector and shock supply chains.
After Google Research released "TurboQuant," aftershocks from the so-called "TurboQuant shock" are continuing on expectations that it could affect artificial intelligence (AI) investment and memory chip demand. Over the weekend, Nvidia's share price fell more than 2% amid assessments that Google's TurboQuant technology could reduce future data center expenditure.
U.S. tech stocks including Nvidia, Tesla, and Oracle fell on individual issues, weighing on the domestic market.
The KOSDAQ index is also plunging. After opening down 3.5%, the KOSDAQ index is falling near the 1,100 level.