South Korean stock market is filled with panic and sets the largest single-day drop in history.

Due to concerns about the Middle East war, panic swept through the South Korean stock market on Wednesday, leading to the most severe sell-off in history for the previously hottest global stock market. Following a 7.2% drop in the previous trading day, the KOSPI composite price index closed 12% lower on Wednesday, with heavyweight stocks like Samsung Electronics, SK Hynix, and Hyundai Motor plummeting. This sharp decline led to a 20-minute trading halt in the morning session. Out of the 800+ constituent stocks in this benchmark index, only 10 saw gains. From Wall Street strategists to individual investors, hardly anyone anticipated this situation. Previously, optimism was high about the demand for memory chips brought about by artificial intelligence (AI), leading individual investors to borrow money to enter the market, and analysts to raise their already bullish ratings on the South Korean stock market. Then, the Iran war broke out. Global stock markets fell on worries that rising oil prices would exacerbate inflation, while the decline in the South Korean stock market was further amplified by record pre-war leveraged financing. Leveraged bets that once amplified gains are now accelerating the decline, as massive borrowing is being forced to liquidate amidst the plummeting stock prices.