KOSPI Plunges on Trump’s Threat of “Extremely Powerful Strikes”

According to Financial News, the domestic stock market is sharply lower following extremely hard-line remarks by President of the United States Donald Trump. As of 11:00 a.m. on the 2nd, the Korea Composite Stock Price Index (KOSPI) was trading at 5,331.61, down 2.68% from the previous session, according to the Korea Exchange. The KOSDAQ was also down 2.78% at 1,085.62.
On the 1st local time, President Donald Trump delivered a national address on the war with the Islamic Republic of Iran at the White House in Washington, D.C. His comments that "over the next two to three weeks, we will deliver extremely powerful strikes" and that "we will do everything we can to turn our opponent back to the Stone Age" are seen as the main trigger for the market reaction.
On the supply-and-demand side, both foreign investors and retail investors are net sellers, driving the index lower. In the KOSPI market, foreigners are net selling about 85.3 billion won and individuals about 387.2 billion won, while institutions are offsetting this with roughly 367.4 billion won in net purchases.
Most large-cap stocks by market capitalization are weak. Samsung Electronics is down around 4%, and SK hynix is also off about 4%, with major semiconductor names dragging the index lower. Hyundai Motor Company, SK Square, LG Energy Solution, and Doosan Enerbility are likewise all in decline.
Defense and some biotech stocks, by contrast, are gaining. Hanwha Aerospace is up about 5%, reflecting expectations of benefits from rising geopolitical risk, and Samsung Biologics is also moving higher.
fair@fnnews.com Han Young-joon Reporter