South Korea’s stock market dived more than 8 percent during Friday morning trading, triggering the stock exchange to temporarily halt trading on both the country’s main bourse Kospi and tech-heavy Kosdaq market.
It is the first time in Seoul stock market to activate circuit breakers in both Kospi and Kosdaq market in one trading session.
The Korea Exchange activated the circuit breaker to suspend the Kospi’s operation for 20 minutes around 10:43 a.m., as the index plummeted over 8 percent for more than a minute. The index dipped to 1,684.93 points -- plunging 149.40 points, or 8.14 percent from the previous session’s close at the time.
It was the first time the circuit breaker had been activated for the main bourse since Sep. 12, 2001 -- a day after the 9/11 terror attack in the US. It marked 12 times triggering the circuit breaker in Seoul stock market to ease panic selling.
Ahead of the circuit breaker the nation’s sole market operator activated a “sidecar” to halt the trading of shares for five minutes around 9:06 a.m. after Kospi 200 index futures slipped more than 5 percent. The KRX also activated the sidecar a day earlier after a sharp drop.
The Kospi opened at 1,722.68 points -- shedding 111.65 points, or 6.09 percent from the previous session. It then tumbled to 1684.56 points in early trading.
The KRX also activated the circuit breaker to suspend trading on the Kosdaq at around 9:04 a.m. The index had dipped to 516.63 points -- plunging 46.86 points from the previous session’s close at the time. The index had dipped to 516.63 points -- plunging 46.86 points from the previous session’s close at the time.
It was the first time the circuit breaker had been activated for the Kosdaq since Feb. 12, 2016, at a time of heightened North Korea risks and concerns about global stagnation.
The Kosdaq opened at 589.20 points -- falling 6.41 points, or 1.08 percent from the previous session. It then crumbled to 487.07 in late morning.
The drastic falls were attributed to panic selling sparked by an overnight plunge on Wall Street amid growing concerns over the new coronavirus fallout around the globe.
The Dow Jones Industrial Average surrendered 2,352.60 points, or 9.99 percent, closing at 21,200.62 on Thursday -- marking its worst daily plunge since 1987.
The tech-heavy Nasdaq and S&P 500 also plummeted 9.43 percent and 9.51 percent to close at 7,201.80 and 2,480.64, respectively.
In the meantime, the local currency against the greenback also declined. It opened at 1,215 won, down 8.50 won per dollar then continued to fall.
The Korean Won was trading at 1,223 won against the US dollar, as of 9:26 a.m., which is the highest value since March 3, 2016, with 1,227 won per dollar.
By Jie Ye-eun (email@example.com