South Korea FSC Rebuts Bloomberg 'Uninvestable' Claim With Market Data

South Korea's Financial Services Commission issued an official rebuttal on the night of the 4th to a Bloomberg column claiming the country is becoming uninvestable. Bloomberg columnist Shuli Ren had written that KOSPI dropped approximately 40% in just 27 trading days from its June high, comparing it to China's 2015 market crash. The FSC disputed the column's statistical basis, stating the cited figure of 360,000 forced liquidation accounts contradicts actual data showing daily averages around 3,000 accounts in June. The commission emphasized that South Korea's economic fundamentals remain strong, with KOSPI-listed companies' profit forecasts rising from 930 trillion won on June 22 to 978 trillion won as of the previous day. On the 5th, KOSPI opened sharply higher, recovering to the 6,600 level with a gain of 274.75 points (4.32%) to reach 6,633.7 as of 9:02 AM.

FSC Disputes Bloomberg Column's Statistical Basis

The Financial Services Commission stated that the Bloomberg column's core statistics do not match factual data and lack verifiable sources. The FSC specifically challenged the claim of 360,000 forced liquidation accounts, noting that actual forced liquidations in June averaged around 3,000 accounts daily. The commission declared there is no concern that South Korea would be evaluated as an uninvestable country based on unclear figures, particularly as the country is emerging as an irreplaceable supply chain and investment destination in the global AI market. The FSC emphasized that South Korea's economy shows solid fundamentals in terms of GDP growth rate and current account balance.

KOSPI Companies' Profit Forecasts Rise Despite Market Volatility

According to F&Guide data cited by the FSC, profit forecasts for KOSPI-listed companies increased from 930 trillion won on June 22 (when KOSPI recorded its high point) to 978 trillion won as of the previous day. The commission stated that expectations for AI and semiconductor industries have elevated domestic companies' projected performance beyond levels seen during the market peak period. The FSC noted that multiple domestic and international investment banks are placing weight on South Korea's growth potential. The commission characterized recent market volatility as resulting from multiple complex factors, with market assessments showing signs of recovering investor sentiment.

Single-Stock Leveraged Product Trading Volume Declines Sharply

Trading volume for single-stock leveraged products reached 1.3 trillion won on the previous day, according to FSC data. This represents a significant decrease from 12.4 trillion won on day 30 of the previous month (before basic deposit requirement increases) and 19.4 trillion won on June 25 when trading peaked. The FSC stated that transactions have rapidly stabilized following the implementation of supplementary measures including increased basic deposit requirements. The commission announced plans to continue managing volatility while consistently pursuing capital market structural improvements that enhance market resilience and growth potential alongside short-term volatility management.

FAQ

What specific statistics did South Korea's FSC dispute in the Bloomberg column?

The FSC disputed the claim of 360,000 forced liquidation accounts, stating actual data showed forced liquidations averaged around 3,000 accounts daily in June. The commission stated the column's statistics do not match factual data and lack verifiable sources.

How have profit forecasts for KOSPI companies changed since the market peak?

According to F&Guide data cited by the FSC, profit forecasts for KOSPI-listed companies increased from 930 trillion won on June 22 (the market high point) to 978 trillion won as of the previous day, driven by expectations for AI and semiconductor industries.