Kospi surge triggers sidecar trading curb amid market volatility

Finance

Kospi surge triggers sidecar trading curb amid market volatility

Published: 06 Aug. 2024, 09:38 Updated: 06 Aug. 2024, 10:18

신하늬
shin.hanee@joongang.co.kr

A screen in Hana Bank's trading room in central Seoul shows the Kospi opening on Tuesday. [YONHAP]

The Korea Exchange activated a sidecar trading halt shortly after the market opened on Tuesday due to a rapid upward surge in the Kospi, which recovered sharply from the previous day's losses.

The sidecar was triggered at 9:06 a.m. on Tuesday, halting program trading of futures for five minutes after the Kospi 200 Futures index rose 5.06 percent, or 16.75 points, from the previous session to 347.20.

It is the first time since June 16, 2020, that a sidecar was activated due to a steep surge in the main Kospi.

A sidecar suspends futures trading for five minutes to prevent panic. It is triggered when Kospi 200 futures rise or fall more than 5 percent and maintain that gain or loss for at least one minute. On Monday, a rapid drop in the Kospi 200 Futures index triggered a sidecar at 11:00 a.m.

As of 9:25 a.m., the Kospi stood at 2,552.21, up 110.66 points or 4.53 percent from the previous day, rapidly recovering from Monday's historic 234.64-point plunge.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]