The KOSPI index dropped significantly in early trading, falling below the 6,500 mark. Ongoing geopolitical uncertainties surrounding the military conflict between the U.S. and Iran, coupled with heavy selling by institutional investors, are weighing on the index. The KOSDAQ also experienced a decline of over 2%.
As of 9:11 a.m. on July 21, the KOSPI was down 63.26 points (0.97%) at 6,453.01 compared to the previous trading day.
In the securities market, individual investors have made a net purchase of 189 billion won. Foreign investors are also net buyers, with 7.6 billion won, while institutions have sold a net 203.1 billion won, contributing to the index's decline.
Most of the top market capitalization stocks are showing weakness. Samsung Electronics is trading at 245,500 won, up 1,500 won from the previous day. In contrast, SK Hynix has dropped 16,000 won to 1,748,000 won, and Hyundai Motor is down 15,500 won at 383,500 won. Samsung Biologics is down 17,000 won at 2,220,000 won, while Samsung Electro-Mechanics has fallen 20,000 won to 1,255,000 won.
At the same time, the KOSDAQ index is down 17.16 points (2.29%) at 732.48. In the KOSDAQ market, individual investors have made a net purchase of 28.2 billion won, while foreign and institutional investors have sold a net 23.6 billion won and 6.1 billion won, respectively.
Overnight, U.S. stock markets fell amid concerns over the military conflict between the U.S. and Iran and rising international oil prices. On July 20, the Dow Jones Industrial Average closed down 307.16 points (0.59%) at 51,839.26. The S&P 500 index fell 14.41 points (0.19%) to 7,443.28, and the Nasdaq Composite dropped 12.17 points (0.05%) to 25,508.07.
U.S. markets started the day on a positive note but turned lower as concerns about the situation in the Middle East grew. President Donald Trump warned of further retaliation against Iran in connection with U.S. military casualties, increasing geopolitical uncertainty and pressuring investor sentiment.
However, recent significant corrections in semiconductor and artificial intelligence (AI) stocks have attracted bargain-hunting, which has limited the extent of the index's decline. Micron Technology rose 1.94%, while AMD and Astera Labs increased by 1.58% and 1.80%, respectively.
The geopolitical tensions surrounding the Middle East are considered a major variable for the domestic stock market. President Trump has indicated a tough stance, suggesting that Iran will face severe consequences for each U.S. soldier's death.
Lee Kyung-min, a researcher at Daishin Securities, stated, "With President Trump's announcement of a strong response to U.S. casualties, the situation is escalating regarding U.S. military responses."
Additionally, the announcement by Yemen's Iran-aligned Houthi rebels of a maritime blockade against Saudi Arabia adds to the pressure. The researcher noted, "If the Houthi rebels proceed with the maritime blockade against Saudi Arabia, there is a high possibility of obstructing traffic through the Bab el-Mandeb Strait, which is the entrance to the Red Sea. Such restrictions could reduce global oil supply by about 7%."
* This article has been translated by AI.
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