Kospi plunges 1.5% as Asian markets open mixed; China shows resilience

Asian markets opened mixed on Tuesday, as investors tried to make sense of an oil market swinging between panic and relief.

The region’s trading session was shaped by a familiar tension as crude prices pulled back from their latest highs, but they remain at levels that threaten to feed inflation.

That left markets split at the open, with South Korea taking the hardest hit while parts of Greater China managed to edge higher.

Even as oil prices appeared to be easing slightly on Tuesday, Brent was still on track for a record monthly increase of about 59% in March, while US crude was up roughly 56%.

The developments underscore how deeply the Iran conflict and the disruption around the Strait of Hormuz continue to reverberate through global assets.

South Korea bears the brunt

The sharpest signs of stress were evident in South Korea, where both equities and the currency came under pressure.

The Kospi fell 1.53% at the open and the small-cap Kosdaq dropped more than 1.51%.

The Korean won also slid 0.57% to 1,525.6 per US dollar, its weakest level since 2009.

Bank of Korea governor nominee Shin Hyun-song had described the Middle East war as the biggest risk facing South Korea’s economy.

South Korea is especially sensitive to an external energy shock because higher oil prices can quickly push up costs and complicate the inflation outlook.

Japan and Australia stay cautious

Elsewhere in the region, the picture was more mixed.

Japan’s Nikkei 225 fell 0.13%, but the broader Topix reversed earlier losses to rise 0.18%.

Australia’s S&P/ASX 200 dropped 0.86%, reflecting the broader caution that has gripped developed Asian markets as oil volatility feeds inflation concerns.

Chinese markets showed more resilience.

Hong Kong’s Hang Seng index rose 0.53%, while mainland China’s CSI 300 gained 0.4%.

That contrast is important as this was not a uniform regional selloff.

Instead, investors appeared to be drawing distinctions between markets seen as more vulnerable to a prolonged oil shock and those supported by hopes that the conflict may not widen further.

Oil and the Middle East war remain central focus

In his latest remarks, US President Donald Trump indicated that he was willing to consider ending the war without first reopening the Strait of Hormuz.

The development helped in easing oil prices as Brent fell to around $111.56 a barrel and WTI to about $101.90.

But the retreat did little to change the bigger picture as crude remains historically elevated and the geopolitical premium in energy markets remains heavy.

Around one-fifth of global oil supply moves through Hormuz, so even a partial disruption is enough to keep traders, policymakers, and investors on edge.