South Korean Stocks Surge, Rebounding from Historic Plunge Amid Easing Oil Fears
SEOUL, South Korea (AP) — South Korean stocks experienced a dramatic rebound Thursday, soaring nearly 10% after suffering their worst single-day drop in history the previous session. The rally was fueled by signs of stabilization in oil prices following concerns sparked by the ongoing conflict in the Middle East.
The Korea Composite Stock Price Index (KOSPI) jumped 490.36 points, or 9.63%, to close at 5,583.9, ending a three-day losing streak. This marks the largest daily gain in points in KOSPI history, surpassing the previous record set in February. The percentage increase was the second steepest since the global financial crisis of 2008.
The surge followed a day of volatility that prompted the Korea Exchange (KRX) to temporarily halt trading of KOSPI futures at the open. Trading volume was heavy, reaching 1.6 billion shares worth 44.8 trillion won (US$30.5 billion).
Individual investors spearheaded the rally, purchasing a net 1.79 trillion won in shares. This contrasted with net sales from foreign and institutional investors, who offloaded 144.6 billion won and 1.7 trillion won respectively.
“The KOSPI experienced the sharpest decline in history yesterday, dropping near the 5,000-point line,” explained Roh Dong-gil, an analyst at Shinhan Securities. “Bargain hunters returned to the market to drive the turnaround.”
The positive momentum mirrored gains on Wall Street overnight, with the Dow Jones Industrial Average rising 0.49% and the Nasdaq Composite climbing 1.29% as oil price concerns eased.
Leading South Korean companies led the charge. Samsung Electronics jumped 11.27% to 191,600 won, while SK hynix soared 10.84% to 941,000 won. Automakers Hyundai Motor and Kia also saw significant gains, rising 9.38% and 6.19% respectively.
Defense stocks also performed strongly, with Hanwha Aerospace increasing 4.38% and LIG Nex1 surging 23.26%. Financial institutions and tech companies also contributed to the rally, including Shinhan Financial Group and Naver.
The South Korean won also strengthened against the U.S. dollar, trading at 1,468.1 won at 3:30 p.m., up 8.1 won from the previous session. Bond prices also rose, with yields on three- and five-year government bonds declining.
The rebound comes as South Korea, a major importer of oil, is particularly vulnerable to disruptions in Middle East supply. The Hana Financial Group has announced a humanitarian and financial support program for Koreans affected by the conflict, and Hana Bank is establishing a rapid-response team to monitor the situation and provide assistance to Korea-linked firms.
