Markets Today: KOSPI surges 9.63% to lead Asian rally, Europe struggles, FTSE 100 eyes recovery

• South Korea's KOSPI surged 9.63% to lead a strong rebound across Asia, fueled by optimism over potential US-Iran diplomatic progress.
• The pan-European STOXX 600 dipped 0.3%, weighed down by escalating geopolitical conflict.
• Upcoming eurozone retail data, an ECB speech, and key US labor data (Challenger job cuts) are expected to drive market focus and potentially further support the US Dollar.

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Asian markets saw a stellar rebound this morning led by South Korea's benchmark KOSPI index surging 9.63% to close at 5,583.90.

This massive gain, which saw the index jump as much as 12.2% during intraday trading, effectively erased the majority of the record-breaking 12.06% loss suffered just a day prior.

Investor sentiment was primarily lifted by optimism surrounding potential diplomatic progress between the US and Iran. Major tech players led the recovery, as Samsung Electronics and SK Hynix climbed 11.27% and 10.84% respectively, while LG Energy Solution posted a solid 6.91% gain.

The rally extended across the broader Asia-Pacific region, with the Nikkei jumping 4.2% and the MSCI’s broadest regional index (excluding Japan) rising 3.9%.

In China, the CSI300 and Shanghai Composite indices saw more modest gains of 1.4% and 1% as Beijing unveiled its 15th five-year plan. While the Chinese government set a slightly lower 2026 growth target of 4.5%–5% to focus on rebalancing the economy and addressing industrial overcapacity, the market was supported by pledges to boost innovation, high-tech sectors, and household consumption.

European markets softened on Thursday as the pan-European STOXX 600 dipped 0.3% to 610.72 points, paring back some of the significant gains made during Wednesday’s recovery.

Market sentiment was primarily dampened by the escalating conflict between the US, Israel, and Iran, which entered its sixth day following fresh Iranian missile strikes and a U.S. Senate decision to continue its air campaign. This geopolitical tension hit the mining sector particularly hard, leading market losses with a 1.5% decline.

Beyond the geopolitical backdrop, a series of disappointing corporate earnings contributed to the downward trend.

Shares of the payments firm Nexi were halted after a record 11.3% plunge following its full-year results, while DHL saw a 5.4% drop after reporting a slide in fourth-quarter operating profit.

The US dollar resumed its upward trajectory on Thursday after a brief pullback.

Although the "greenback" briefly retreated earlier in the session on tentative hopes for a shorter conflict and the restoration of oil shipments through the Strait of Hormuz, these gains were quickly reversed.

Ongoing hostilities between the US, Israel, and Iran, now in their sixth day kept investors cautious following a fresh wave of Iranian missile strikes.

Consequently, the dollar index rose 0.2% to 99.00, bringing its total weekly gain to nearly 1.4%.

This renewed strength in the dollar pressured several major currencies and digital assets. Both the euro and sterling slipped, falling 0.2% and 0.27% respectively, while the Japanese yen gave back its early morning gains to trade flat at 157.08 per dollar.

Commodity-linked currencies also felt the squeeze, with the Australian dollar dropping 0.35% and the New Zealand dollar declining 0.2%.

Meanwhile, the cryptocurrency market saw a cooling period, as both Bitcoin and Ether shed over 1% each, paring back the significant gains they had recorded during the previous session.

Currency Power Balance

Energy markets continued their upward climb on Thursday. Brent crude rose 2.9% to reach $83.75 per barrel, while US West Texas Intermediate (WTI) jumped 3.2% to $77.08.

This sustained rally is being driven by significant supply disruptions, forcing several major producers to slash output while others scramble to implement emergency security measures to protect global energy flows.

In the precious metals market, spot gold edged up 0.4% to $5,153.11 per ounce as investors sought safety amid the widening Middle East crisis. While the geopolitical instability provided a clear floor for bullion, further gains were capped by a rebounding US dollar.

The sentiment did not extend to industrial precious metals, however; silver tumbled 1.5% to $82.20 per ounce, while palladium and platinum also faced downward pressure, dropping 1.2% and 0.5% respectively.

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As the trading day continues, markets remain cautious, shifting their focus toward upcoming eurozone retail and construction data, as well as an afternoon speech by ECB President Christine Lagarde for potential signals on future monetary policy.

Looking ahead to the US session, markets are bracing for a heavy data slate on Thursday, with the focus squarely on Challenger job cuts, initial jobless claims, and import prices.

The Challenger report is particularly high-stakes following a massive surge in January, which saw 108,435 announced layoffs, the highest for that month since 2009, leading many to watch for signs of a cooling labor market.

Given the prevailing economic uncertainty and the potential for these data points to signal a softening economy, many analysts suspect the US Dollar (DXY) could climb toward the upper end of its recent trading range.

Simultaneously, the currency market remains transfixed by the volatility of European natural gas prices. As the conflict in the Middle East threatens energy security and drives Dutch TTF futures sharply higher, the resulting inflationary pressure and risk-off sentiment are expected to provide additional support to the greenback. Should gas prices continue their upward trajectory today, the Dollar Index (DXY) will likely edge back toward the $99.40$–$99.50$ area, reinforcing its dominance as a safe-haven destination during global turmoil.

Lastly, keep a close watch on developments around the US and Iran. A short while ago reports stated that the Iranian Deputy Foreign Minister has said they would be open to abandoning their nuclear program if the US can provide a good deal. No official confirmation on the comments, but as the saying goes “ where there's smoke, there's fire” rings true.

From a technical perspective, the FTSE 100 index fell around 500 odd points earlier this week.

The Index breached the 100-day MA before finding support at the 200-day MA resting around the 10400 handle.

Since then, the Index has bounced off the 200-day MA and is currently testing the 100-day MA

A break above above the 100-day MA is needed for bulls to seize the initiative. Otherwise we could see price continue to compress between the 100 and 200-day MAs.

Immediate support rests at 10500 before the 10439 (200-day MA) handle comes into focus.

Resistance to the upside at 10628 (100-day MA) needs to be cleared if bulls are to make a run for the 10728 handle and beyond.

FTSE 100 Index Four-Hour Chart, March 5, 2026

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