South Korean market falls on rising tensions in region

South Korea’s stock market took a major drubbing on Monday, with shares down by the largest one-day drop in a month amid investor fears of war in the region.

The Pentagon deployed a Navy strike group including an aircraft carrier, missile destroyers and missile cruisers, near the Korean peninsula over the weekend, a move described by the White House as a “prudent” reaction to North Korea’s provocative behaviour.

Kim Jong-un’s nation last week fired a missile into the Sea of Japan and recently released a propaganda video showing a US aircraft carrier being blown up.

North Korea has also indicated the possibility of an intercontinental ballistic missile test, which some experts say could come on April 15, the 105th birthday of North Korea’s founding president Kim Il-sung and an annual celebration known as The Day of the Sun.

The latest developments have hit markets in neighbouring South Korea hard.

Today its benchmark index, the Kospi, was down for a fifth consecutive day and its biggest daily decline in more than a month, off 0.9%.

The Korean currency was 0.7% weaker at 1142.52 won per dollar and eyeing its fifth day of declines in a row.