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South Korean Stocks Take Huge Hit, Plummet 5.5% As Monday Bloodbath Continues

South Korean stocks took a significant hit, plummeting more than 5.5 percent on Monday. This marked the fourth consecutive day of losses, a trend triggered by panic selling in response to escalating global trade tensions sparked by US reciprocal tariffs. The Korean won also experienced its most significant fall since the COVID-19 pandemic against the U.S. dollar.

The Korea Composite Stock Price Index (KOSPI), the benchmark index, shed 137.22 points, or 5.57 percent, to close at 2,328.20. The tech-heavy KOSDAQ also experienced a significant dip of 5.8 percent. The steep decline prompted the bourse operator to issue the first sidecar order since August 2024, halting program purchasing for five minutes after the KOSPI 200 index shed over 5 percent for more than 1 minute.

The trading volume was notably heavy, with 615.2 million shares worth 10.5 trillion won ($7.16 billion) changing hands. Losers significantly outnumbered winners, with 862 to 68. Foreign investors offloaded 2.09 trillion won worth of local shares, while retail investors and institutions purchased 1.67 trillion won and 253.2 billion won, respectively.

Impact of US Tariffs and China’s Retaliation

The KOSPI’s sharp decline was primarily driven by investors’ growing fears of a recession following the Trump administration’s announcement of reciprocal tariffs last week. This announcement prompted China to retaliate with 34 percent tariffs on U.S. goods and export controls on rare earths, while also threatening additional steps in the near future.

Park Seok-joong, an analyst at Shinhan Securities, commented on the situation, stating, Volatility in the Korean stock markets heightened on the Trump administration’s stronger-than-expected tariff policies. He further added, None of the Korean export industries will be able to evade the influence of the U.S. tariff scheme.

This situation is reminiscent of Wall Street’s worst week since the COVID-19 pandemic last week, with the S&P 500 plunging 6 percent on Friday (U.S. time), while the Dow Jones Industrial Average plummeted 5.5 percent and the tech-heavy Nasdaq composite lost 5.8 percent.

Seoul’s Big-Cap Shares Hit Yearly Low

In Seoul, many big-cap shares slid to hit their lowest mark in a year. Market bellwether Samsung Electronics slid 5.17 percent to 53,200 won, and its chipmaking rival SK hynix shot down 9.55 percent to 164,800 won. Top carmaker Hyundai Motor sank 6.62 percent to 179,100 won, and major defense firm Hanwha Aerospace plunged 8.55 percent to 642,000 won.

Leading shipbuilders Hanwha Ocean and HD Hyundai Heavy plummeted 9.81 percent and 8.17 percent to 62,500 won and 275,500 won, respectively. Major bio company Samsung Biologics lost 5.71 percent to 1.01 million won, and steel giant POSCO Holdings slumped 6.59 percent to 255,000 won. Financial shares also sharply went down, with KB Financial dipping 6.95 percent to 72,300 won and Meritz Financial losing 5.66 percent to 111,700 won.

The local currency was quoted at 1,467.8 won per dollar at 3:30 p.m. local time, down 33.7 won from the previous session. This marked the steepest single-day decline since March 19, 2020, when the currency dropped by 40 won amid the COVID-19 pandemic.

US Tariff Shock Triggers Singapore’s Worst Market Plunge Since 2008, Trails Nikkei

Global markets continued to reel from the economic fallout of sweeping U.S. tariffs, with Singapore and Japan suffering their steepest stock declines in years amid mounting fears of a trade-driven global recession.

Singapore’s Straits Times Index (STI) nosedived 8.7% at the open on Monday, dropping to 3,494.39, marking the worst single-day fall for the benchmark since the 2008 global financial crisis, when it slumped 8.9%. Monday’s fall also exceeded the 8.4% crash during the early days of the Covid-19 pandemic in March 2020.

“According to experts, if tariffs are sustained, they could contribute to higher inflation and slower global growth, which may inurn trigger further volatility and potential sell-offs in markets globally, including Singapore,” said David Gerald, President of the Securities Investors Association (Singapore), as quoted by The Straits Times.

The association said Singapore’s market had shown relative resilience in recent weeks despite the threat of U.S. tariffs, but “ultimately caved in” on Friday following worse-than-expected tariff announcements by President Donald Trump.

On Wednesday, Trump signed an executive order enacting a 10% baseline tariff on all U.S. imports, including goods from Singapore, with higher rates targeting specific countries such as China, Vietnam, and Thailand. The move has intensified concerns that the global economy could tip into recession.

Tokyo Hit by Third-Largest Point Drop on Record

Japan also suffered a dramatic sell-off. The Nikkei 225 plummeted 2,644.00 points, or 7.83%, to close at 31,136.58, marking its third-largest single-day point drop in history. The broader Topix index fell 7.79%, or 193.40 points, ending at 2,288.66.

During early trading, the Nikkei fell as much as 2,843.48 points, or 8.42%, briefly touching 30,937.10—its lowest intraday level since October 2023.

The latest round of tariffs, part of Trump’s “America First” trade policy, includes levies of up to 50% on certain imports and has triggered waves of retaliatory warnings and diplomatic outreach from countries across Asia and beyond.

“This is a sell-anything-that-has-made-money move,” said Rikki Malik, a portfolio manager at Springboard Capital. “Banks [are] at the forefront of that. However, I think we are close to capitulation and will see a bounce very soon.”

Analysts warn that market volatility may persist as investors brace for further economic disruption by the Trump Administration.

Japan’s Nikkei Sinks to 1.5-Year Low Trailing Global Recession Fears

Japan’s Nikkei share average nosedived on Monday to its lowest level in a year and a half, as growing fears of a global recession triggered by sweeping U.S. tariffs sent investors fleeing from equities—particularly bank and tech stocks.

The Nikkei 225 index dropped as much as 8.8% during the day to hit 30,792.74, its lowest level since October 2023, before closing 7.8% lower at 31,136.58. All 225 constituents of the index ended the day in negative territory. The broader Topix index slumped 7.8%, after earlier falling as much as 9.6%.

The sharp sell-off follows U.S. President Donald Trump’s announcement last week of a sweeping new round of reciprocal tariffs, affecting nearly every country exporting to the United States. Speaking aboard Air Force One on Sunday, Trump described the tariffs—which range from 10% to 50%—as “medicine,” and signaled his willingness to tolerate the market fallout.

“It’s extremely difficult to judge how far this stock market correction will run [but] as long as there exists a lack of clarity around tariffs and each country’s response, the market will remain heavy,” said Maki Sawada, equities strategist at Nomura Securities.

The banking sector bore the brunt of the sell-off. A Topix index of banking shares plummeted as much as 17.3% before closing down 10%. Over the past three sessions, Japanese banks have collectively lost nearly a quarter of their market value, amid concerns that the tariffs could choke off global growth and keep domestic interest rates lower for longer.

Among major financial stocks, Nomura Holdings tumbled 13.2%, Mizuho Financial Group fell 10.7%, and Mitsubishi UFJ Financial Group dropped 10.4%. The sell-off extended to the tech sector, with Renesas Electronics plunging 16.7%, Sumco Corp. sliding 15.8%, and chip-testing equipment giant Advantest falling 11%.

The losses follow a broader global market rout. Since Trump’s announcement, the Nikkei has fallen 11.6%, while the U.S. S&P 500 has lost 10.6%. Still, some analysts see room for recovery if Washington or other major economies signal flexibility.

“The market currently is only pricing in bad news,” said Sawada. “If there are signs of flexibility on trade policies or the announcement of economic support measures, it’s highly likely we’ll see a bottom form in the market.”

The sharp decline comes as policymakers across Asia scramble to respond to the rapidly evolving trade environment, with countries like Vietnam, Thailand, and Indonesia turning to diplomacy, and others reconsidering their economic forecasts in light of escalating uncertainty.