Seoul stocks plunged 4.47% on U.S. President Donald Trump's renewed threats against Iran, closing the benchmark KOSPI at 5,234.05 after a 244.65-point drop. The Korean won weakened to 1,519.7 against the dollar. Hopes for a swift end to the monthlong Middle East war faded, driving global oil prices higher.
Seoul stocks fell sharply on Thursday, April 2, after U.S. President Donald Trump vowed in a prime-time address to hit Iran "extremely hard over the next two to three weeks" and "bring them back to the Stone Age," warning that Iranian energy facilities could be targeted without a deal. The monthlong Middle East war began in late February following U.S.-Israeli strikes on Iran.
The benchmark Korea Composite Stock Price Index (KOSPI) dropped 244.65 points, or 4.47 percent, to 5,234.05. It had opened more than 1 percent higher, tracking Wall Street gains amid hopes for an end to the conflict, but reversed after Trump's remarks. Trading volume reached 1.42 billion shares worth 32.95 trillion won ($21.72 billion), with 814 decliners outnumbering 90 advancers. Institutions and foreigners sold a net 1.45 trillion won and 136.43 billion won, respectively, while individuals bought a net 1.21 trillion won.
The Korea Exchange (KRX) triggered a sell-side sidecar at around 2:46 p.m., halting program-driven sell orders in KOSPI futures for five minutes. The KOSDAQ fell 5.36 percent to 1,056.34. Brent crude jumped over 4 percent to above $100 a barrel.
"Despite earlier remarks by U.S. and Iranian leaders suggesting the possibility of an end to the conflict, Trump's latest message indicating the war could continue disappointed investors," said Kang Jin-hyuk, an analyst at Shinhan Securities. "Risk-off sentiment is strengthening as expectations for a ceasefire fade."
Losses were widespread, led by tech shares. Samsung Electronics dropped 5.91 percent to 178,400 won, SK hynix sank 7.05 percent to 830,000 won. Defense firm Hanwha Aerospace surged 6.3 percent to 1,417,000 won. The won closed at 1,519.7 against the dollar, down 18.4 won. Three-year Treasury yields rose 10.7 basis points to 3.477 percent, five-year to 3.679 percent.
