Markets react positively as US-Iran tensions ease, boosting South Korean stocks and global markets

South Korean stocks surged over 6% to a record intraday high of 7,355.81 on Wednesday, driven by optimism surrounding renewed peace talks between the United States and Iran, according to multiple reports from the Korea Times. President Donald Trump announced a temporary pause in US actions near the Strait of Hormuz following Iran’s overture for negotiations, which boosted investor confidence. Semiconductor firms Samsung Electronics and SK hynix were key contributors to the rally.

This positive development contrasted with the Pakistani stock market, where the Pakistan Stock Exchange (PSX) fell sharply by more than 2,400 points amid ongoing uncertainty about the US-Iran talks, as reported by Dawn. The diverging performances underscore varying regional market sentiments influenced by geopolitical risks. While South Korean markets are encouraged by peace hope, Pakistani investors remain cautious.

The Korea Times also highlights that the rally in South Korea extended into Thursday, with KOSPI shares climbing further on expectations of a second round of negotiations aimed at reducing tensions in the Middle East. Meanwhile, other global markets, including the US, saw moderate gains attributed in part to the easing of conflict pressures. These gains occurred even as some investors remained wary due to previous failed talks and ongoing regional instability.

Separately, Seoul markets showed resilience earlier in the week with sharp gains on Monday attributed to strong corporate earnings forecasts, despite lingering uncertainty over the US-Iran situation. This suggests underlying economic strength supported investor confidence beyond geopolitical factors, adding to the sustained upward trend in shares.

Looking ahead, market participants will closely watch the progression and concrete outcomes of ongoing US-Iran negotiations, as well as any changes in Strait of Hormuz security measures. The direction of these talks will likely dictate near-term market volatility across Asia and beyond, influencing sectors such as semiconductors and energy.