Seoul shares fall for 2nd day on foreign selling amid renewed Hormuz tensions

SEOUL, Aug. 7 (Yonhap) -- The Korean stock market experienced a second consecutive day of decline on Friday, as foreign investors exited their positions amid heightened tensions in the Middle East. The Korea Composite Stock Price Index (KOSPI) dropped 0.6 percent to close at 6,258.77, down 37.61 points from its opening level. The index had previously fallen 4.58 percent the prior day, primarily driven by declines in technology stocks.

The broader U.S. stock market also suffered, with the Dow Jones Industrial Average losing 0.85 percent and the Nasdaq Composite slipping 0.06 percent due to uncertainty over a potential agreement between the United States and Iran to restore access to the Strait of Hormuz. Iran has warned it could block the vital waterway and demand reparations from hostile nations seeking passage.

As a result of this uncertainty, foreign investors sold a total of 858.07 billion won worth of stocks, while domestic investors, both institutional and retail, bought 578.99 billion won and 266.98 billion won worth of shares, respectively. Experts suggest that the ongoing uncertainty surrounding the strategic waterway could continue to fuel oil price volatility, further exacerbating market instability already shaken by concerns over AI-related trade.