Japan, South Korea Stocks Rebound Strongly: South Korea’s Kospi Surges Over 12%, Nikkei 225 Jumps 4%

TradingKey - On March 5, stock markets in Tokyo and Seoul collectively opened higher and continued to rise, staging a strong rebound.

The Nikkei 225 index opened 1.8% higher, with intraday gains expanding to nearly 4%. It rebounded more than 2,100 points from the previous session's low, surging into the 56,300 range and nearly recouping all losses from March 4.

South Korea's KOSPI opened with a 3.1% gain, which subsequently widened to 12%. Following a sharp rise in stock index futures, the Korea Exchange briefly suspended program trading on the KOSPI and KOSDAQ markets.

Samsung Electronics surged 13%, while SK Hynix saw gains reach 15%.

On March 4, South Korea's KOSPI suffered its worst single-day performance in history, ultimately closing down over 12%. A circuit breaker was triggered when intraday losses reached 8%, suspending trading for 20 minutes. Combined with a drop of more than 7% the previous day, the two-day cumulative decline exceeded 20%, not only erasing all gains from February but also setting the record for the largest two-day drop since the 2008 financial crisis.

The Japanese market was also under pressure, with the Nikkei 225 index closing down 3.61% on March 4 at 54,245.54 points, hitting a nearly one-month low. Intraday losses briefly exceeded 4%, breaking below the 54,000 psychological level.

During the three trading cycles following military actions by the United States and Israel against Iran, market panic continued to spread, and pessimistic expectations were overblown. This, in turn, spurred short-term "bottom-fishing" capital targeting an oversold rebound. Meanwhile, reports emerged that Iran is negotiating a ceasefire through diplomatic channels, a signal that quickly eased market tensions and attracted capital inflows.

The Nikkei 225 index opened 1.8% higher, while South Korea's KOSPI opened up 3.1%.

Gains in South Korea's KOSPI widened to 12%. Following a sharp surge in stock index futures, South Korea briefly suspended program trading on the KOSPI and KOSDAQ markets.

Samsung Electronics soared 13%, and SK Hynix rose 15%.

On March 5, the Nikkei Stock Average in Tokyo rebounded sharply. Compared to the previous day, gains at one point exceeded 2,100 points, rising into the 56,300 range and nearly fully recovering the losses from the 4th.

In the three trading days since the U.S. and Israel began attacks on Iran, the Nikkei Average fell by a cumulative total of approximately 4,600 points, making the market prone to buying interest targeting a short-term rebound. Additionally, some reports suggested that Iran is exploring the possibility of a ceasefire through diplomatic channels, news which also stimulated buying.

On March 4, South Korea's KOSPI Composite Index closed down over 12%, its largest single-day drop ever. A circuit breaker was triggered after an 8% intraday slide, halting trading for 20 minutes. The index had also fallen more than 7% the previous day. The two-day cumulative loss widened to 20%, erasing all gains in February and marking the most severe two-day decline since 2008.

As of the close on the 4th, the Nikkei 225 index also plummeted 3.61% to 54,245.54 points, hitting a nearly one-month low. The index dropped more than 4% during the session, falling below 54,000 points.