South Korea's financial regulator has announced it will closely monitor stock market fluctuations and is prepared to actively deploy a 100 trillion won market stabilization plan if necessary to counter excessive turbulence.

On March 4, Bloomberg reported that Financial Services Commission Chairman Lee Eog-weon made these remarks during a meeting with market experts. He further emphasized that regulators would intensify surveillance of potential market-disruptive activities during periods of high volatility and impose severe penalties for any violations.

Market experts attending the meeting expressed the view that South Korea currently possesses the capacity for policy intervention. They suggested that market participants should base their decisions on confidence in the economy and financial markets rather than succumbing to excessive panic.

The South Korean stock market recorded a second consecutive day of significant declines. The KOSPI index dropped over 12%, with Hyundai Motor falling nearly 16% and Samsung Electronics declining close to 12%.

A 100 trillion won "firewall" is on standby. Chairman Lee Eog-weon explicitly stated at the meeting that authorities are closely watching market developments and will proactively utilize the stabilization fund if excessive volatility occurs.

Analysts indicate this statement sends a clear policy signal that authorities are prepared for market intervention.

Simultaneously, Lee Eog-weon stressed that regulators will enhance monitoring of potentially disruptive activities during high volatility and strictly punish any misconduct. This stance aims to maintain market order and prevent speculative behavior from worsening fluctuations.

Market experts participating in the meeting noted that, given South Korea's ample policy space, participants should avoid excessive anxiety and instead make rational judgments based on confidence in the domestic economy and financial markets. Experts believe the existence of policy reserves itself provides effective support for market sentiment.

The South Korean stock market experienced continued heavy losses. According to a Wall Street News article, the Korean market has become the epicenter of the current turmoil. Christopher Forbes, Head of Asia and Middle East Business at CMC Markets, explained that following a joint US-Israel action effectively blocking the Strait of Hormuz, buy orders nearly evaporated, order books emptied instantly, and foreign capital withdrew over $7 billion within just two trading days.

South Korea was previously one of the world's best-performing markets this year, driven by AI and memory chip cycle trends, with peak gains approaching 50%. Holdings were highly concentrated in large-cap tech heavyweights like Samsung Electronics and SK Hynix. Lorraine Tan, Director of Asia Equity Research at Morningstar, stated that the KOSPI index decline is largely attributable to the high concentration of individual stocks in the Korean market.

Data shows memory giants Samsung and SK Hynix together account for nearly 50% of the index's weighting. With shares of Samsung Electronics and SK Hynix both plunging 10%, she suggested the stock declines are partly due to profit-taking in a risk-averse environment and also hint at growing market concern about a potential slowdown in AI data center deployment.