The South Korean Kospi and Kosdaq indices both plummeted over 10% in early trading, forcing the exchange to suspend trading urgently. Market data shows that the financial, technology, and manufacturing sectors suffered significant losses as investor concerns about the escalating conflict in the Middle East and soaring energy prices spread rapidly. This sharp decline is not an isolated incident, as other major Asian markets also faced pressure: Japan's Nikkei 225 and Topix indices both fell nearly 4%, Hong Kong's Hang Seng Index dropped about 3%, and China's Shanghai Composite Index also closed down 1.3%.
Analysts point out that this round of selling is partly due to a correction in market sentiment after several months of strong gains, with some high-growth sectors becoming primary targets for risk-averse capital. Economies like South Korea and Japan, which heavily rely on external energy, have become hard-hit due to the heightened geopolitical risks in the Middle East. South Korea imports about 94% of its crude oil, with 75% coming from the Middle East; any threats to key energy routes like the Strait of Hormuz would directly increase domestic energy costs, thereby dragging down stock market performance. The Thai market was also affected, with a single-day drop of 7.8%, reflecting the regional economy's general sensitivity to energy supply chains.
In response to Iran's threat to close the Strait of Hormuz, global oil prices surged. Brent crude oil prices soared 14% in a single day to $82 per barrel, while West Texas Intermediate (WTI) crude rose 12% to about $75, marking a recent high in price increases. These fluctuations stem from the ongoing escalation of regional military actions since February 28.
Notably, in contrast to the severe volatility in traditional stock markets, the cryptocurrency market has shown relative resilience. On that day, the total market capitalization of global digital assets only slightly declined by 0.5%, maintaining a total size of around $2.39 trillion. Although the crypto market has accumulated a 21% drop since the beginning of the year, its volatility is much lower than that of the stock market, indicating that some investors still view it as an alternative safe-haven asset amid geopolitical turmoil.