Escalating Middle East conflict triggered a major market selloff, forcing a halt to trading on the Korean Stock Exchange. South Korea’s main indexes plunged over 10%, while oil prices surged. Crypto researcher SungHoon Lee described the event as a “black swan,” noting $3.2 trillion in global stock market value had evaporated in four days.
The Korean Stock Exchange halted trading after a major share price plunge during Wednesday’s session. South Korea’s Kospi and Kosdaq each fell more than 10%, triggering a circuit breaker as Channel News Asia reported. Japan’s Nikkei and Topix fell nearly 4%, while Hong Kong’s Hang Seng dropped 3%.
“Investors sold down risk assets, and in particular, the Nikkei as well as the Kospi, which outperform other major indexes, have become a target of the heavier selloff as they try to book profits,” Kazuaki Shimada, chief strategist at IwaiCosmo Securities, told CNA. Jim Bianco, CEO of Bianco Research, noted South Korea imports 94% of its oil, with 75% coming from the Middle East.
Thailand’s stock exchange slid 7.8% on Wednesday. The market turmoil followed an intensification of attacks on Iran and the closure of the Strait of Hormuz. “If necessary, the United States Navy will begin escorting tankers through the Strait of Hormuz, as soon as possible,” former President Donald Trump said on Truth Social.
Crude oil prices soared, with Brent oil surging 14% to $82 per barrel, according to OilPrice. Crypto researcher SungHoon Lee called it a black swan event, explaining trading was halted because the crash was too fast.
“This isn’t just a war. This is the WORST geopolitical shock since 1973,” he stated, referencing an oil crisis that crashed markets for two years. He also noted $3.2 trillion in global stock market value had evaporated over four days.
Crypto asset markets, which have lost 21% this year, saw a milder reaction. Total cryptocurrency market capitalization fell 0.5% on the day to $2.39 trillion, according to CoinGecko.
