▲ Financial Services Commission Chairman Lee Eog-won speaks at a cabinet meeting presided over by President Lee Jae-myung at the Blue House on the 14th.
Financial Services Commission (FSC) Chairman Lee Eog-won announced today (July 16) that the commission will soon prepare and release supplementary measures regarding single-stock leveraged products, which have been identified as a major cause of stock market volatility.
Appearing on the program 'Kim Ou-joon's Humility Is Difficult News Factory' today, Chairman Lee was asked whether single-stock leverage has an impact on recent market volatility. He replied, "The question is to what extent that impact exists," adding, "We are closely monitoring and deliberating on these aspects, and we plan to swiftly prepare and announce supplementary measures in the near future."
Regarding the possibility of temporary trading halts, he stated, "The market has its own domain, and such measures could lead to greater side effects, so we are examining the situation comprehensively."
When asked again whether such measures were included in the upcoming plan, he refrained from providing further details.
Chairman Lee identified "increased volatility in the global semiconductor industry" as a factor in market instability, noting that "the semiconductor industry has grown rapidly through a super cycle, and stock prices have risen significantly in a short period."
He further pointed out that "expectations and concerns are crossing paths daily, causing stock prices to fluctuate whenever news emerges," noting that this volatility is not limited to Korea but is also observed in overseas semiconductor stocks.
Addressing the observation that Korean semiconductor stocks are experiencing greater fluctuations compared to their overseas counterparts, he explained that as the market capitalizations of Samsung Electronics and SK Hynix have surged and their weight in the KOSPI has increased, "the surface area susceptible to shocks has expanded."
Emphasizing once again that single-stock leveraged products are short-term, high-risk instruments, he noted that to mitigate market volatility, it is necessary to encourage the inflow of long-term capital and diversified investment, while also creating conditions for long-term investment through industrial policies that foster trusted companies and the protection of shareholder value.
Regarding the criticism directed at the Financial Services Commission over the single-stock leverage situation, Chairman Lee said, "As the person in charge of the financial market, it is a burden I must naturally bear, and we are working in close consultation with relevant ministries."
(Photo: Blue House Photo Press Corps, Yonhap News)
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