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Kospi soars nearly 7% as won hits one-month high on cease-fire optimism

Published: 08 Apr. 2026, 17:25 Updated: 11 Apr. 2026, 16:24

JIN MIN-JI
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An electronic display board shows Korea’s market at Woori Bank’s trading room in central Seoul on April 8. That day, the market rallied, with the Kospi surging 6.87 percent to 5,872.34 as investors were relieved by the conditional two-week cease-fire of the Middle East conflict, during which shipping traffic is allowed through the Strait of Hormuz. [NEWS1]

The Kospi jumped almost 7 percent on Wednesday, rallying sharply as investors cheered reports of a tentative U.S.-Iran cease-fire tied to reopening the Strait of Hormuz, which buoyed sentiment across Asian markets. The won also gained against the dollar to its strongest level in a month.

The benchmark Kospi surged 6.87 percent to 5,872.34, driven by strong gains in chipmakers and construction stocks, and the tech-heavy Kosdaq rallied 5.12 percent to 1,089.85. The Korea Exchange triggered a five-minute buy-side sidecar on both indexes, temporarily pausing program-driven futures buy orders.

Markets surged after U.S. President Donald Trump announced that he had agreed to a proposed two-week cease-fire with Iran, provided that shipping resumes through the Strait of Hormuz. The agreement was reached less than two hours before Trump’s deadline regarding attacks on Tehran’s civilian infrastructure was set to expire. Oil slid below $100 per barrel following the agreement, with the price of Brent crude, the international oil benchmark, falling nearly 15 percent to trade at around $95.

“Up until last week, the messaging had been very forceful — almost like an ultimatum — but with this agreement, markets are reacting to a sense that the worst-case scenario has been avoided,” said Kang Jin-hyuk, an analyst from Shinhan Securities. “If the deal were to break down or energy facilities were targeted, conditions could quickly turn negative again. However, actions such as strikes on military facilities or attacks on noncore infrastructure are unlikely to have a significant impact on markets going forward.”

Foreign and institutional investors drove the Wednesday rally, scooping up a net 2.43 trillion won ($1.64 billion) and 2.71 trillion won, respectively. Individual investors unloaded a net 5.41 trillion won.

Market bellwether Samsung Electronics advanced 7.12 percent to 210,500 won, and its rival SK hynix surged 12.77 percent to 1.03 million won. Automaker Hyundai Motor rose 7.4 percent to 508,000 won, and Kia gained 5.57 percent to 159,200 won.

Construction firms also moved higher on expectations of potential reconstruction opportunities in Iran. Daewoo Engineering & Construction rose 29.97 percent to 22,500 won, and Hyundai Engineering & Construction soared 21.04 percent to 188,700 won. But defense shares decelerated, with Hanwha Aerospace falling 3.45 percent to 1.48 million won and Hyundai Rotem decelerating 2.13 percent to 206,500 won.

Regarding talks between the United States and Iran in Pakistan’s Islamabad, scheduled for Friday, the key issue to watch is the continued opening of the Strait of Hormuz, the main gateway for global oil and energy exports. Whether Iran establishes tolls on the waterway, which it recently indicated, will not be a determining factor in the market.

“Right now, the market is not viewing tolls as a major negative, so even if they are imposed, they are unlikely to cause a significant shock,” Kang explained. “What matters more than whether fees are charged is whether the strait remains open. Since it has reopened for now, the market sees the major risk as having been largely resolved.”

U.S. President Donald Trump, left, flanked by U.S. Secretary of Defense Pete Hegseth, speaks during a press conference in the James S. Brady Press Briefing Room at the White House in Washington on April 6. [REUTERS/YONHAP]

Protocols for safe passage through the strait are included in the 10-point cease-fire proposal that Iran reportedly conveyed to the White House via Pakistani intermediaries, according to Iranian state media.

The foreign exchange market also saw sharp moves, as the won traded at 1,470.6 per dollar as of 3:30 p.m., rising 33.6 won from the previous session to its strongest level since March 11. The dollar index, which tracks the dollar against six major currencies, slipped below the 99 mark as the volatility eased.

BY JIN MIN-JI [[email protected]]