FSS Deputy Governor: "Strict Action Against Unfair Practices Exploiting Stock Market Volatility"
As domestic stock markets experienced a rollercoaster session—plunging and then rebounding sharply—due to military clashes between the United States and Iran, the financial authorities issued a warning that they would respond sternly to unfair practices that take advantage of such volatility.
On the morning of March 5, the Financial Supervisory Service held an emergency meeting with market experts at its headquarters in Yeouido, presided over by Hwang Sunoh, Deputy Governor for Capital Markets and Accounting, to discuss the recent situation in the Middle East.
At the meeting, capital market experts—including overseas investment bank market specialists and heads of research at domestic securities firms—identified the recent increase in domestic market volatility as primarily caused by geopolitical risks such as the situation in the Middle East, as well as a rise in profit-taking demand. They also diagnosed that, in the short term, further increases in volatility of macro indicators such as oil prices and exchange rates, as well as stock prices, are inevitable.
However, as the recent stock market rally has been driven by strong corporate earnings and government shareholder-friendly policies, they viewed the impact on the market’s overall direction as limited. Accordingly, the experts agreed that rather than overreacting to short-term volatility, market participants should make balanced decisions based on trust in the Korean economy and the competitiveness of its companies.
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Deputy Governor Hwang emphasized, “If necessary, we will carry out step-by-step measures according to emergency response plans without delay,” and added, “We will take strict action against unfair practices in the capital market, such as spreading false information and price manipulation that take advantage of stock market volatility.” He also requested that the securities industry make every effort to protect investors, including providing accurate information so that individual investors can make rational investment decisions amid the heightened volatility.
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