Construction stocks surged across the board early on the 3rd. Buying is seen flocking in on news that Iran is discussing passage through the Strait of Hormuz. Although oil prices spiked the previous day after a hard-line speech by U.S. President Trump, the market appears to have focused on the latest talks on an opening plan.
As of 9:30 a.m. on the day, in the Korea Exchange, DL E&C was trading at 77,800 won, up 9,700 won (14.24%) from the previous session. At the same time, Daewoo Engineering & Construction was also up 1,290 won (7.85%) at 17,730 won.
In addition, GS Engineering & Construction (7.25%), KCC E&C (5.25%), and Hyundai Engineering & Construction (3.63%) were also strong.
Kazem Gharibabadi, Iran Vice Minister of Foreign Affairs, said in an interview with Russia's Sputnik on the 2nd (local time), "Iran and Oman, as coastal states, are drafting a joint protocol for the safety of navigation in the Strait of Hormuz in peacetime," adding, "This is not a restriction but aims to guarantee safe passage and provide better services."
The fact that more than 40 countries around the world, including Korea, held a foreign ministers' meeting to explore plans to open the Strait of Hormuz on the day also appeared to affect investor sentiment.
Construction stocks have tended to surge whenever tensions in the Middle East showed signs of easing. With energy facilities in Middle Eastern countries damaged by the current war, there is an outlook that, in the long term after the war, reconstruction demand could emerge in the region.