Market Review: Panic to Euphoria—K-Market Erases War Fears as Geopolitical Discount Fades

On Tuesday, March 10, 2026, the domestic equity market staged an explosive recovery, officially shifting from panic-selling to aggressive accumulation. The KOSPI skyrocketed +4.74% to close at 5,500.59, successfully triggering a buy-side sidecar during the morning session. The KOSDAQ also surged +3.37% to 1,139.48. Foreign investors, who had been heavily shorting the market, executed a massive pivot by net-buying over 1 trillion KRW on the KOSPI, primarily targeting the battered electronics sector.

1. Geopolitical De-escalation: Trump’s ‘Endgame’ and the Oil Crash

The primary catalyst for the market’s violent upward reversal was a sharp de-escalation in Middle Eastern war premiums.

• Trump’s CBS Interview: In a pivotal interview, President Trump stated that Iran’s military capabilities—including its Navy, Army, and communications—have been largely destroyed.
• Accelerated Timeline: He noted that while the war will not end this week, the conflict is concluding much faster than the initially projected 4 to 5 weeks.
• Oil Price Collapse: Following these remarks, WTI crude oil, which had threatened to breach $120, plummeted back to the $82–$88 range.
• G7 SPR Coordination: The energy market was further cooled by reports that G7 nations are actively preparing to release strategic petroleum reserves (SPR) to combat speculative pricing.
• Government Support: Domestically, President Lee Jae-myung ordered immediate measures to counter volatility, including oil price ceilings, energy tax adjustments, and direct consumer support.

2. Semiconductor Resurrection: From ‘Victims’ to Leaders

The semiconductor sector, which had been disproportionately punished due to its high electricity consumption profile during the energy spike, led the index recovery.

• Relief Rally: As oil prices stabilized, the "Stagflation and Power Cost" discount evaporated, leading to aggressive foreign buybacks.
• The Giants Awaken: Samsung Electronics (005930) surged an impressive +8.0%, while SK Hynix (000660) rocketed +11.1%, acting as the primary engines for the KOSPI’s 5,500 restoration.

3. Sector Rotation: Airlines Soar, Defense Retreats, Nuclear Advances

The sudden shift in geopolitical expectations forced a rapid recalibration of sector portfolios.

• Airlines: Freed from the immediate threat of crippling jet fuel costs, aviation stocks rebounded sharply, with Korean Air (003490) rising +8.3% and Hanjin Kal gaining +9.6%.
• Defense: The sector that acted as the ultimate war hedge saw immediate profit-taking upon Trump’s early-endgame signals, pushing LIG Nex1 (079550) down -6.2% and Hanwha Systems down -5.2%.
• Nuclear Power: Anticipation built around the ‘Special Act on US Investment,’ scheduled for a plenary session vote on March 12. This pushed Doosan Enerbility (034020) up +6.2% and Woori Technology up +21.8%.

4. KOSDAQ Active ETFs Launch

The official launch of KOSDAQ Active ETFs injected highly targeted liquidity into specific mid-cap growth stocks.

• Inclusion Surge: Companies confirmed to be included in these new active portfolios experienced massive inflows.
• Key Gainers: Qurient and Sungho Electronics both hit near upper limits (+27.8%), while Sungwoo Hitech (+22.2%) and HVM (+18.4%) demonstrated extreme outperformance.

Institutional Conviction: Top 5 Momentum Tickers

Foreigners and institutions aggressively unwound short positions and loaded up on oversold fundamentals:

1. SK Hynix (000660): Leading the semiconductor short-covering rally (+11.1%) as global tech sentiment normalizes.
2. Samsung Electronics (005930): Absorbed the bulk of the 1 trillion KRW foreign net purchase to reclaim its structural uptrend.
3. Qurient (115180): The standout beneficiary (+27.8%) of the newly launched KOSDAQ Active ETF inflows.
4. Korean Air (003490): The primary reflex-beneficiary of the collapsing crude oil premium.
5. Woori Technology (032820): Capturing speculative capital (+21.8%) ahead of the crucial March 12 nuclear policy vote.

Investor Strategy: The market has successfully defended the 5,000-point macro floor and violently reclaimed 5,500, confirming that the recent crash was a temporary geopolitical dislocation rather than a fundamental breakdown. While day-to-day news flow from the Middle East may still cause intraday chop, the overarching trend is pointing toward stabilization. We recommend rotating out of temporary war-hedges (Defense/Refining) and re-establishing core overweight positions in Semiconductors and Nuclear Power infrastructure. Furthermore, carefully monitor the constituents of the new KOSDAQ Active ETFs, as institutional rebalancing will continue to drive liquidity into these specific names throughout the week.