Seoul's stock market opened sharply lower on February 2 due to risk-averse sentiment following the nomination of a new U.S. Federal Reserve chair. The KOSPI index fell 1.05% in the first 15 minutes and was down 3.47% by 11:20 a.m. Investors offloaded tech heavyweights, particularly major semiconductor makers.
On Monday, February 2, 2026, Seoul's KOSPI index plunged amid fallout from the nomination of a new U.S. Federal Reserve chair. President Donald Trump named former Fed Governor Kevin Warsh as the front-runner, whose hawkish stance on interest rates heightened investor caution. This followed a lower close in U.S. stocks on Friday, with the S&P 500 down 0.43% and the Nasdaq sliding 0.94%. Gold and silver prices tumbled more than 10% and 30%, respectively, halting their rallies, while Microsoft's shares dropped sharply due to disappointing cloud revenue that reignited fears over AI spending profitability.
The KOSPI opened 55 points, or 1.05%, lower at 5,169.36 in the first 15 minutes of trading. Major shares like Samsung Electronics fell 1.5% and SK hynix retreated 3.19%, though defense firm Hanwha Aerospace advanced 3.62%. Trump's threats of 50% tariffs on Canadian planes and new duties on countries selling oil to Cuba added to market jitters.
By 11:20 a.m., the index had fallen further by 181.36 points, or 3.47%, to 5,043, as institutional and foreign investors offloaded shares in major semiconductor makers and other large-cap tech firms. Samsung Electronics dipped 2.62%, SK hynix 4.73%, Hyundai Motor 2.3%, LG Energy Solution 2.39%, and Hanwha Aerospace 3.08%. The Korean won traded at 1,458 to the U.S. dollar, down 18.5 won from the previous session.
The downturn reflects combined pressures from global trade tensions and rate-hike expectations, posing risks to South Korea's export-driven economy.