South Korea's KOSPI Crashes 13% Amid Hormuz War Fears

South Korea’s stock market recorded its steepest decline on Wednesday as rising geopolitical tensions in the Middle East triggered a sharp selloff across global markets.

The benchmark KOSPI index plunged about 13%, forcing a temporary halt in trading as investors rushed to sell equities.

The decline followed growing concerns over a possible disruption to global oil supplies after the conflict involving Iran, the United States, and Israel intensified.

Investors reacted to reports that shipping through the Strait of Hormuz could be affected. The strategic waterway is one of the world’s most important oil transit routes.

• KOSPI plunges 13% as Middle East tensions shake global markets
• Strait of Hormuz fears trigger selloff in South Korea stocks
• Oil price surge hits semiconductor and technology shares

Oil prices surged on fears that Iran could restrict or block traffic through the Strait of Hormuz, a route that carries nearly 20% of the world’s oil supply. The surge in crude prices raised concerns about inflation and economic pressure on oil-importing countries, including South Korea.

Major technology stocks led the market decline. Shares of Samsung Electronics and SK Hynix fell significantly as investors sold semiconductor stocks amid uncertainty in global markets. The heavy losses in semiconductor companies weighed on the broader KOSPI index.

The Korea Exchange triggered a circuit breaker after the benchmark index dropped sharply, briefly suspending trading to reduce volatility. Despite the halt, selling pressure remained strong as investors reacted to geopolitical risks and rising energy prices.

The market decline extended across Asia. Japan’s Nikkei index, Taiwan’s benchmark index, and other Asian markets also recorded losses as investors moved funds into safer assets.

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Analysts said continued tensions in the Middle East could keep financial markets volatile, particularly if oil supply routes remain at risk. For South Korea, which relies heavily on imported energy and global trade, disruptions in energy supply and rising oil prices could add pressure on the economy.