Seoul: Seoul stocks fell nearly 3 percent Monday, led by heavy foreign selling, as an intensifying conflict surrounding Iran deepened concerns about global oil supplies and market uncertainties. The Korean won weakened against the U.S. dollar. The benchmark Korea Composite Stock Price Index (KOSPI) fell 161.57 points, or 2.97 percent, to 5,277.3, extending the losing streak to a third session.

According to Yonhap News Agency, the index opened nearly 5 percent lower Monday before paring some of its earlier losses on buying by retail and institutional investors. Risk-off sentiment intensified as the war in the Middle East showed signs of further escalation, with the Houthis launching their first attacks on Israel since the conflict began in late February and warning of continued military operations until attacks on Iran stop.

The involvement of the Houthis poses a fresh risk to global oil markets, as concerns over further supply disruptions have risen over whether they will target vessels in the Red Sea, a crucial route for global oil and liquefied natural gas (LNG) shipments. U.S. President Donald Trump said negotiations with Iran to end the war are going smoothly, while Washington has ordered thousands of troops to the region.

Global oil prices have already risen markedly as the Strait of Hormuz has effectively been closed, disrupting global oil supplies. South Korea depends heavily on imports for energy. The local currency was quoted at 1,515.7 won against the U.S. dollar as of 3:30 p.m., down 6.8 won from the previous session.