Global Market | South Korea's KOSPI leaps 12%, rebounds from worst-ever crash

South Korea's benchmark KOSPI index surged as much as 12% on Thursday, swiftly erasing almost all of its worst-ever daily drop a day earlier, buoyed by hopes for progress in U.S.-Iran diplomacy.

The rebound followed a New ‌York Times ⁠report ⁠on Wednesday suggesting Iran's Ministry of Intelligence had signalled a willingness to engage in talks with the U.S. Central Intelligence Agency to seek an end to the war, citing officials briefed on the matter.

The share index climbed to 5,685.47 at the open, regaining most of Wednesday's 12.06% loss.


"Oil has somewhat stabilised overnight and there's definitely more confidence ⁠among foreign ‌investors about a potential resolution. The rebound is strong especially for chips," Seo Sang-young, an analyst at Mirae Asset ⁠Securities Co.

Market sentiment was further bolstered as global oil prices stabilised and Wall Street showed resilience overnight despite the ongoing Middle East conflict.

The Korea Exchange also activated a sidecar trading curb on both the benchmark KOSPI and junior KOSDAQ index, briefly halting programme trading for five minutes after stocks surged.

President Lee Jae Myung affirmed the government's readiness to deploy market stabilising measures ‌if needed.

"We must proactively respond to increased financial market volatility. We should accelerate policy efforts and swiftly implement and manage the 100 trillion won ⁠market stabilisation programme," Lee said at a policy meeting. He was referring to the government's emergency fund that can be deployed in times of major market declines.

Among index heavyweights, chipmaker Samsung Electronics rose 14.98%, while peer SK Hynix gained 16.02%. Battery maker LG Energy Solution climbed 7.90%.

Hyundai Motor and sister automaker Kia jumped 12.6% and 8.6%, respectively. Steelmaker POSCO Holdings added 9.64%, while drugmaker Samsung Biologics advanced 5.47%.