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Kospi sidecar triggered as U.S. tariff concerns send bourse nose-diving

Published: 07 Apr. 2025, 09:26 Updated: 07 Apr. 2025, 20:05

LIM JEONG-WON
[email protected]

The Kospi is seen on a screen at a trading room at Hana Bank in Jung District, central Seoul, on April 4. [YONHAP]

A sidecar mechanism was triggered on the main Kospi bourse Monday morning following a sharp drop in the Kospi 200 futures index. It marked the first activation of a sidecar in eight months, the last occurring in August 2024.

According to the Korea Exchange, the sidecar was activated at 9:12 a.m. after the Kospi 200 futures index fell more than 5 percent and remained there for one minute. The sidecar temporarily suspends the effectiveness of program sell orders for five minutes to help stabilize the market.

At the time of the trigger, the Kospi 200 futures index had dropped 17.1 points, or 5.19 percent, to 312.05 compared to the previous session's close.

A sidecar is triggered when the Kospi 200 futures index rises or falls by more than 5 percent and sustains that change for at least one minute.

The last instance occurred in August 2024, when a sell-side sidecar was triggered on Aug. 5 due to a market drop, followed by a buy-side sidecar the next day amid a sharp rebound.

Friday's decline was attributed to concerns over U.S. tariff measures and their impact on global equity markets. The Kospi opened at 2,359.25, down 106.17 points or 4.31 percent from the previous close, briefly shedding more than 4.5 percent in early trading.

The won-dollar exchange rate was up 27.9 won to 1,462 won, while the won-yen exchange rate exceeded 1,000 won per 100 yen, the highest level in about 2 years.

Update, April 7, 2025: Added details about sidecar, recast headline.

BY KIM EUN-BIN, LIM JEONG-WON [[email protected]]