South Korean Stocks Open Sharply Higher on US-Iran Peace Deal

SEOUL, June 15 (Yonhap) -- South Korean stocks opened sharply higher Monday as the United States and Iran reached an agreement to end their monthslong war in the Middle East, which includes a reopening of the Hormuz Strait.

The benchmark Korea Composite Stock Price Index (KOSPI) rose 407.79 points, or 5.02 percent, to 8,531.41, as of 9:15 a.m.

Such a steep rise triggered Seoul's bourse operator to issue a buy-side sidecar shortly after the market open, halting program trading for five minutes.

On Sunday (local time), Pakistan said the U.S. and Iran reached an agreement to end the war and reopen the Strait of Hormuz, a key shipping route for global energy supplies that Iran has effectively shut down for months, providing some relief to investors who have been suffering extreme market volatility in the wake of the war.

U.S. President Donald Trump also confirmed a deal has been reached and said he had authorized a toll-free opening of the strait, as well as an immediate removal of the Navy blockade there.

Though full details of the deal were not immediately available, a signing will take place Friday in Switzerland.

Oil prices fell on the news of the peace deal. Brent crude, the international oil benchmark, was down 3.37 percent to US$87.3 per barrel, a sharp retreat compared with early May, when the figure was around $100.

In Seoul, shares gathered ground across the board.

Market top-cap Samsung Electronics added 4.96 percent, while its chipmaking rival SK hynix advanced 6.65 percent.

Top car maker Hyundai Motor rose 6.75 percent, shipbuilding giant HD Hyundai Heavy Industries jumped 9.54 percent, and defense giant Hanwha Aerospace inched up 0.74 percent.

The local currency was trading at 1,504.8 won against the U.S. dollar, up sharply 15 won from the previous session, as of 9:15 a.m.