Asian Stocks Rebound Led by South Korea After Sharp Sell-Off
Asian stocks rebounded on Thursday, March 5, 2026, with South Korea leading the gains after experiencing its worst decline on record. The recovery comes as markets find some stability following increased volatility triggered by conflict in the Middle East.
The Korea Composite Stock Price Index (KOSPI) surged 8.4%, driving the MSCI Asia Pacific Index up 2.2% for its first increase in four sessions. This followed a rise on Wall Street on Wednesday, boosted by strong economic data that eased inflation concerns. However, the advance appeared tentative, with U.S. And European equity futures falling in Asian trading while the dollar strengthened, reaffirming its safe-haven status during times of crisis.
Chinese stocks also rose even as the country set its 2026 gross domestic product (GDP) growth target at 4.5% to 5%, the lowest goal since 1991. China also targeted a consumer price index (CPI) of around 2% for 2026.
While stock market sentiment improved, crude oil continued to climb. The fluctuations in Asian markets reflect the broader global uncertainty stemming from geopolitical tensions and their potential economic impact.
Earlier in the week, Asian markets suffered significant losses, with the KOSPI plummeting by more than 12% on Wednesday, March 4, 2026, marking its worst daily drop in history amid disruption from the escalating conflict in Iran, according to Euronews.
On Monday, March 9, 2026, stock markets in South Korea and Japan experienced a sharp decline at the start of trading, after the price of benchmark U.S. Crude oil exceeded $100 per barrel, as reported by Alkhaleej.
South Korea is also considering imposing a price cap on fuel due to the war in Iran, according to Al Jazeera.
The market volatility underscores the sensitivity of Asian economies to geopolitical events and fluctuations in global energy prices. FXStreet reported that Asian forex markets are facing risks from war and differing policies, as outlined by MUFG. Proactive measures are being taken across Asia to prepare for various scenarios, as reported by Al-Ahram Gate.
