I just reviewed the performance of Asian markets this week, and there’s something interesting happening in South Korea. South Korean stock indices experienced a quite notable rebound recently, with the KOSPI rising around 2% in the morning session. Samsung Electronics and SK Hynix also showed significant gains, close to 4% and over 2% respectively.

The reason behind this movement has to do with the geopolitical situation. If tensions in Iran cause a serious disruption in oil supply, it is speculated that the South Korean government might announce an additional budget in the second half of the year to stabilize the stock market. It’s a fairly typical move when there is global economic uncertainty.

What’s interesting is that while Asian markets reacted positively to these expectations, we also saw Nasdaq futures recover ground and the Japanese market trading higher. However, all of this has moderated a bit as oil prices remain high, which has been putting pressure on South Korean indices in recent days.

This is the kind of dynamic worth watching. When stimulus policies are in play combined with volatility in commodities, Asian markets tend to move quite a bit. South Korea is a good indicator of how investors are currently assessing global risk.