Seoul: South Korean stocks traded sharply lower late Monday morning as investors panicked on escalating global trade tensions after China hit back at the U.S. administration's reciprocal tariffs. The benchmark Korea Composite Stock Price Index (KOSPI) lost 103.57 points, or 4.2 percent, to 2,361.85 as of 11:20 a.m.
According to Yonhap News Agency, with the steep drop, the bourse operator issued a sidecar order at 9:12 a.m., halting program purchasing for five minutes, after the KOSPI 200 index shed over 5 percent for more than 1 minute. It was the first sidecar order for program buying since August 2024.
The KOSPI nosedived as investors dumped stocks amid growing fears of a recession following the Trump administration's announcement of reciprocal tariffs last week, prompting China to fire back with plans for additional 34 percent tariffs on U.S. goods and export controls on rare earths. Wall Street also saw its worst week since the COVID-19 pandemic, with the S and P 500 plunging 6 percent Friday (U.S. time), while the Dow Jones Industrial Average plummeted 5.5 percent and the tech-heavy Nasdaq composite lost 5.8 percent.
In Seoul, most major stocks lost ground. Market bellwether Samsung Electronics slid 3.74 percent and its chipmaking rival SK hynix plunged 6.64 percent. Top carmaker Hyundai Motor sank 4.48 percent, and major defense firm Hanwha Aerospace shot down 7.55 percent. Leading shipbuilders Hanwha Ocean and HD Hyundai Heavy slumped 6.93 percent and 6 percent, respectively. Major bio company Samsung Biologics lost 4.68 percent, and steel giant POSCO Holdings dropped 4.76 percent. Financial shares also sharply went down, with KB Financial dipping 6.69 percent and Meritz Financial losing 4.65 percent.
The local currency was trading at 1,468.9 won against the U.S. dollar at 11:20 a.m., down 34.8 won from the previous session.