One month after the outbreak of war in the Middle East, significant shifts have occurred among the top market capitalization rankings on Korea's KOSPI and KOSDAQ markets. Defense stocks drew investor attention, lifting Hanwha Aerospace (012450.KS) up the rankings, while export-heavy sectors such as automobiles and shipbuilding slipped.
According to Korea Exchange (KRX) data as of May 27, Samsung Electronics (005930.KS) held the No. 1 spot by market capitalization on the KOSPI (excluding preferred shares), followed by SK hynix (000660.KS) at No. 2. Rounding out the top 10 were Hyundai Motor (005380.KS) at No. 3, LG Energy Solution (373220.KS), Samsung Biologics (207940.KS), SK Square (402340.KS), Hanwha Aerospace, Doosan Enerbility (034020.KS), Kia (000270.KS), and KB Financial Group (105560.KS).
Compared with April 27 — just before the war broke out — Hanwha Aerospace climbed three spots from 10th to 7th, and KB Financial Group rose two spots from 12th to 10th. Kia slipped two spots from 7th to 9th, and HD Hyundai Heavy Industries dropped two spots from 9th to 11th.
Hanwha Aerospace's market capitalization grew 11.7% from 61.6182 trillion won to 68.8371 trillion won over the period. Hyundai Motor maintained its No. 3 position but saw its market cap shrink 26.6% from 138.0067 trillion won to 101.355 trillion won. Kia and HD Hyundai Heavy Industries also saw their market capitalizations decline 24.2% and 17.3%, respectively.
As military tensions in the Middle East intensified, the defense sector attracted the most attention. Hanwha Aerospace, the sector's bellwether, gained 11.7% between the 3rd and the 27th. LIG Nex1 (079550.KS) surged 44.4%, and Hanwha Systems (272210.KS) rose 9.2%.
In contrast, soaring global oil prices and a weak won hit the automobile and shipbuilding sectors. The disruption to naphtha supply — a key feedstock for petrochemicals — caused by the Middle East conflict compounded the damage by creating bottlenecks in ethylene supply.
Hyundai Motor shares, which had been on a rally fueled by the physical artificial intelligence momentum that began early this year, fell 26.6% from 674,000 won on April 27 to 495,000 won on May 27. HD Hyundai Heavy Industries shares declined 17.3% over the same period.
On the KOSDAQ, Samchundang Pharmaceutical (000250.KQ) surged sharply in a short period to claim the No. 1 spot. The top 10 by market capitalization as of the 27th were Samchundang Pharmaceutical, Alteogen (196170.KQ), EcoPro (086520.KQ), EcoPro BM (247540.KQ), Rainbow Robotics (277810.KQ), Kolon TissueGene (950160.KQ), ABL Bio (298380.KQ), LEENO Industrial (058470.KQ), LegoChem Biosciences (141080.KQ), and HLB (028300.KQ).
While Alteogen, EcoPro, and EcoPro BM had long jostled for the top three positions, Samchundang Pharmaceutical — ranked 10th at the start of the year — climbed to 4th on April 27 and reclaimed the No. 1 spot on the 20th. The rally was triggered by the company's May 19 disclosure that it had completed submission of an Investigational New Drug (IND) application for a Phase 1/2 clinical trial of its oral insulin in Europe.
Market analysts said the impact of the Middle East war on Korea's stock market is likely to persist for the time being, and that investors should watch whether the conflict begins to erode corporate fundamentals.