South Korea's Political Stir Sends Shockwaves Through Asian Markets

Amid political upheaval in South Korea, Asian markets experienced turbulence as martial law was briefly imposed and lifted. The KOSPI index suffered, deepening its losses this year. South Korea's finance ministry and financial regulators quickly signaled their readiness to stabilize markets. The incident adds global uncertainty, affecting currencies and investor sentiment.

Asian markets faced significant disruption on Wednesday as political tension in South Korea unfolded, with martial law imposed and rapidly rescinded. This development impacted Asian equities, with the South Korean won initially strengthening due to suspected intervention, yet remaining near a two-year low against the dollar.

The benchmark KOSPI index declined nearly 2%, worsening its year-to-date fall to over 7%, marking it as Asia's worst-performing stock market this year. In response to political upheaval, South Korea declared its readiness to infuse 'unlimited' liquidity to stabilize its financial markets, backed by a 10 trillion won stock market fund.

This situation heightened concerns about global uncertainties, with the financial markets closely watching related developments in France and the Federal Reserve's upcoming monetary policy signals amid a complex geopolitical backdrop.

(With inputs from agencies.)