◆ KOSPI uneasy running ◆
KOSPI surpassed the 3200 line at the beginning of the market on the 11th due to the massive buying trend of individual investors. On this day, a person is watching the display board in the lobby of the Korea Exchange in Yeouido. [한주형 기자]– The fact that the Financial Services Commission announced its policy to resume short selling on the 11th is interpreted as a paving stone to hurry to block the anticipation of an extension of the short selling ban, which is spreading in some parts of the market. The Financial Services Commission announced that it would finish improving the system with the aim of resuming short selling in March by sending a notice text message to reporters in and out at around 7:30 pm. With the breakthrough of the KOSPI 3000, it was a moment when the net buying trend of individual investors was strong.
Individuals said that short selling could pour cold water on the stock market, and some lawmakers opposed the resumption of short selling. Park Yong-jin, a member of the Democratic Party, said, “The average daily short selling transaction amount from January to March 13 last year was 6541 billion won, an increase of 400% over the past 10 years.” It turned out to be abused and illegal short selling,” he expressed concern. The prospect was raised that the financial authorities could not prematurely decide to resume short selling, conscious of public opinion from individual investors and the National Assembly.
The Financial Services Commission seems to have felt the need to put a brake before individual investors’ expectations for the extension of the short selling ban increase. The fact that the stock market recently crossed the 3000 line and showed signs of short-term overheating, which is interpreted as fueling the policy to resume short selling.
Finance Commissioner Eun Seong-soo said at a recent weekly business meeting, “Anxiety and expectations are intersecting with the stock price of 3000. Above all, it is important to invest within the scope of your investment capacity through an accurate analysis of corporate performance.” And mentioned careful investment.
– The reason for continuing the ban on short selling has decreased considerably as the domestic stock market has risen to an all-time high recently after the Corona 19 shock. Considering that the KOSPI was 1771.44 and the KOSDAQ index was 524 at the time of the first ban on short selling in March last year, the current share price level is ‘absolutely bad.’
The financial authorities announced a ban on short selling for six months on all listed stocks in the securities, KOSDAQ, and KONEX markets shortly after the stock market close on March 13, last year, which is remembered as’Black Friday the 13th’ due to the stock price crash. In September of last year, the ban on short selling was extended by six months. The deadline for the ban on short selling is March 15.
The Financial Services Commission agrees that a long-term ban on short selling is contrary to the flow of international capital markets. It is expected to form a fair share price through short selling by leaving it to market autonomy. Even if short selling is permitted, the Financial Services Commission plans to improve market transparency by providing additional safeguards. However, if the stock market undergoes a major adjustment in February and March, there is room for a review of measures related to short selling.
The Financial Services Commission is reorganizing the system to strengthen surveillance and punishment for illegal short selling. First of all, amendments to the Capital Markets and Financial Investment Business Act, which impose penalties and criminal penalties for more than one year in prison for’non-borrowing short selling’, which have a high risk of payment defaults, exceeded the limits of the National Assembly last year, and will be implemented in April this year. In addition, measures such as establishing a constant monitoring system and shortening the inspection period have been taken in the case of’borrowing short selling,’ where stocks borrowed from other investors are sold.
The Financial Services Commission is planning to increase the accessibility of short selling by individual investors, taking into consideration the concern that short selling is a playground that is inclined to foreigners and institutions. It is a form of reorganizing the lending system where individuals can borrow stocks from securities finance and sell short stocks through securities companies, and expand the types of stocks that can be lent and lending stock companies.
The financial investment industry predicted that the stock market will be affected considerably if short selling resumes in March as scheduled. In particular, bio and healthcare sectors are considered as sectors where volatility may increase after short selling resumes. Noh-gil, a researcher at NH Investment & Securities, said, “Before and after the ban on short selling last year, the share price of the healthcare sector in the KOSDAQ market has risen significantly.” I can. An official from the asset management company said, “Before the short selling is resumed, an adjustment is expected.” However, in the case of stocks with higher market caps, the possibility of a sharp decline in share prices is low even if short selling is resumed.
[강계만 기자 / 김규식 기자]
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