South Korean stocks rebounded sharply as President Lee Jae Myung activated the country's 68 billion dollar market stabilization fund following Iran's missile strike on Israel. The Kospi index erased earlier losses, with technology and manufacturing shares leading the recovery. Trading volumes surged as investors rushed to capitalize on discounted valuations.

The stabilization fund, established in 2006, is designed to inject liquidity during periods of extreme market volatility. South Korea's intervention marks one of the most aggressive responses to the Middle East conflict's market impact. The move helped restore confidence after initial panic selling wiped out billions in market capitalization.

Analysts note that South Korea's decisive action contrasts with more measured responses from other Asian markets. The fund's activation demonstrates the government's commitment to maintaining market stability amid geopolitical tensions. Trading resumed with renewed vigor as investors reassessed risk following the initial shock of the Iran attack.