Kospi, Kosdaq Trigger Sell Sidecars as Oil Surge Sparks More Than 5% Drop

South Korean stocks tumbled on July 24 after international oil prices surged as tensions in the Middle East intensified.

As of 1:09 p.m., the Kospi had fallen 392.21 points, or 5.53%, to 6,704.68. The benchmark opened 1.35% lower and widened its losses through the session, briefly slipping into the 6,600 range. A sell sidecar was triggered at about 11:23 a.m.

On the main bourse, foreign and institutional investors were net sellers of 3.3749 trillion won and 1.6849 trillion won, respectively. Retail investors alone were net buyers, purchasing 5.0199 trillion won worth of shares, but that was not enough to halt the slide. Foreign investors also turned net sellers after five trading days of net buying.

The selloff came as military clashes between the US and Iran intensified, driving oil prices sharply higher. That fueled concerns over rising inflation and an economic slowdown, hurting appetite for risk assets.

Samsung Electronics and SK Hynix, the market's leading chipmakers, were both down more than 7%. Other large-cap decliners included SK Square, Samsung Electro-Mechanics, Hyundai Motor, LG Energy Solution, Samsung Life Insurance, KB Financial Group, Samsung C&T and Kia.

The Kosdaq also dropped sharply. As of the same time, the index was down 40.65 points, or 5.14%, at 749.63. A sell sidecar was triggered on that market at about 11:47 a.m. Foreign and institutional investors were net sellers of 224.7 billion won and 252.8 billion won, respectively, leading the decline. Retail investors alone were net buyers of 479.6 billion won.

Among Kosdaq stocks with the largest market values, Alteogen, EcoPro, EcoPro BM, Rainbow Robotics, Jusung Engineering, Leeno Industrial, Wonik IPS, ABL Bio and PSK were lower.

Ko Jung-sam, Hankyung.com reporter jsk@hankyung.com