A currency trader passes by a screen showing the Kospi, SK hynix and Samsung Electronics stock prices at the foreign exchange trading room of the Hana Bank headquarters in Seoul on Aug. 5.AP/YONHAP
The Korean financial watchdog rejected a Bloomberg Opinion column that said Korea is becoming uninvestable and said the piece rested on figures the regulator could not trace to a source.
"With Korea emerging as an irreplaceable supply chain and investment destination in the global AI market, there is no concern whatsoever that it will be judged as uninvestable on the basis of figures with unclear grounds," the Financial Services Commission (FSC) said in a statement issued Tuesday night under the title "The government's position on the domestic stock market."
A screen capture of Bloomberg's "South Korea is Becoming Uninvestable, Too" opinion article uploaded on Aug. 4.SCREEN CAPTURE
The column, by Bloomberg Opinion columnist Shuli Ren, ran Monday under the headline "South Korea Is Becoming Uninvestable, Too." It compared the Kospi's drop of nearly 40 percent over 27 trading days with China's market crash in 2015.
The FSC singled out the column's account of forced liquidations, in which a brokerage sells off shares an investor bought with borrowed money once the collateral no longer covers the loan.
The column put the number of accounts forcibly liquidated in the sell-off at an estimated 360,000, with 62 percent of them held by people under 35. It gave no time frame for the count.
However, forced liquidations hit an average of about 3,000 accounts a day in June, the FSC said, and it had not been able to confirm where the column's number came from.
"Korea's economy is more solid in fundamental terms than at any time before," the FSC said.
The Korean economy grew by 3.7 percent in the second quarter from a year earlier and posted its largest current account surplus on record in May, at $38.6 billion.
The Financial Services Commission plaque is seen at the government complex in Jongno District, central Seoul on Sept. 7, 2025.YONHAP
Earnings forecasts for listed companies have also climbed since the stock market peaked. Combined estimates for Kospi-listed companies this year stood at 978 trillion won ($683.9 billion) as of Tuesday, up from 930 trillion won on June 22, the day the index hit its high, in figures compiled by market tracker FnGuide.
A number of investment banks in Korea and overseas still see solid growth potential in the domestic market, the FSC said.
The regulator acknowledged that swings in share prices have widened since June but attributed them to a mix of factors, adding that market participants see investor sentiment starting to recover.
Concerns over single-stock leveraged products have eased since the government tightened the rules on them, the FSC said. Individual investors must now hold at least 30 million won in cash before buying the products, up from 10 million won, under a requirement that took effect on Friday.
Trading in the products peaked at 19.4 trillion won on June 25. It stood at 12.4 trillion won last Thursday, the final session before the cash requirement rose, and fell to 1.3 trillion won on Tuesday.
The FSC will manage short-term volatility while pushing structural improvements to the capital market to make the stock market more resilient and lift its growth prospects.
BY JEONG JAE-HONG [cho.yongjun1@joongang.co.kr]
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
