South Korea’s stock market was forced to halt trading for 20 minutes on Monday as the Kospi index plunged nearly 9% within minutes of opening — a collapse triggered by a sharp sell-off in technology shares and renewed hostilities between Iran and Israel. The Kospi eventually closed down 8.3%, while Japan’s Nikkei fell 3.8%. European markets opened lower but saw smaller falls: Germany’s Dax dropped 0.9% and the UK’s FTSE 100 slipped 0.2%.
The turmoil came after Iran fired missiles at northern Israel and Israel carried out air strikes in western and central Iran — the first time both countries have attacked each other’s territory since a ceasefire was agreed in April. US President Donald Trump responded by calling on both sides to stop “shooting”.
“Global markets fall after Iran-Israel strikes and tech sell-off; Kospi halts trading.”
“The Middle East is in turmoil,” said Jeremy Bowen, the BBC’s international editor, adding that the public are “right to be worried” as the consequences of the war will be felt for generations.
Markets were rattled by a rise in oil prices fuelling inflation concerns, combined with investors repositioning over fears that investments into artificial intelligence may be overvalued. “It’s a messy mix of several shocks,” said Charu Chanana, chief investment strategist at Saxo. “The burden of proof has gone up.”
The Kospi’s trading halt — its third this year — was triggered by a circuit breaker designed to prevent panic selling. Major South Korean tech companies tumbled: Samsung closed down 10%, and SK Hynix also fell sharply. South Korean President Lee Jae-myung said the stock market was expected to experience volatility but believed domestic shares were still “slightly undervalued”.
The losses followed a sharp drop on Wall Street on Friday, where the Nasdaq lost about 4% — its biggest decline in more than a year — after lower-than-expected US unemployment in April and persistently high inflation linked to the Middle East war raised fears of a US interest rate hike.
Taiwan’s Taiex fell sharply as shares of semiconductor giant TSMC dropped 3%. TSMC is a key supplier to Nvidia, whose boss Jensen Huang said the recent slide in tech stocks presented a buying opportunity for investors who are now opting for companies “with more reliable income streams and dividends”.
As oil prices continued to climb and the cycle of retaliation between Iran and Israel showed no sign of abating, traders were left watching a fragile mix of geopolitical risk and tech sector uncertainty — a combination that has already erased billions from global markets.