Benchmark index plummets as much as 12.2 percent, eclipsing single-day plunge after 9/11 attacks in 2001.

South Korea’s stock market has suffered one of the steepest falls in history amid the widening fallout of the United States-Israeli war on Iran.

The benchmark KOSPI index plummeted as much as 12.2 percent on Wednesday, eclipsing the 12.02 percent single-day plunge triggered by the September 11, 2001 attacks on the US and the 9.44 percent drop seen at the height of the 2008 financial crisis.

The index recovered some losses in the afternoon and was down about 10 percent as of 05:00 GMT.

South Korean financial authorities had earlier activated their 20-minute circuit breaker after losses passed the 8 percent threshold for triggering a halt to trading on the exchange.

The plunge followed a 7.2 percent fall in the KOSPI on Tuesday, cementing the worst two-day streak in decades.

Losses were spread across the board, hitting corporate giants such as Samsung Electronics, SK Hynix and LG Electronics.

But shipping and logistics firms suffered the steepest losses amid the effective halt of traffic through the Strait of Hormuz, which carries about one-fifth of the oil consumed globally.

Shares of Pan Ocean, HMM and KSS Line plunged between 17 and 19 percent.

South Korea’s stock market had an explosive start to 2026, with the KOSPI gaining more than 40 percent in the first two months of the year, far outpacing international peers.

The market meltdown is the latest example of economic shockwaves unleashed by the conflict in the Middle East.

US stocks dipped overnight, with the benchmark S&P500 and tech-heavy Nasdaq Composite both falling about 1 percent after Wall Street shrugged off the conflict in the previous session.

US and Israel continued to bombard Iran and Lebanon overnight as the war entered its fifth day, while Tehran launched attacks on Israel and US allies in the Gulf region, including Qatar and the United Arab Emirates.