South Korea President Yoon says ban on short-selling stocks to stay

SOUTH Korean President Yoon Suk Yeol said on Tuesday that the country’s ban on short selling shares would remain in place until improvements are made to address the adverse affects of the practice.

“Neglecting the problem of illegal short selling would not only worsen unfair price formation issues, which can cause great losses to individual investors, but it also could hurt stock market credibility and cause investor withdrawal,” Yoon said at a policy meeting in Seoul.

Analysts and foreign investors have criticised the government’s action.

The decision could hurt fresh investment and discourage foreign investment at a time when Asia’s fourth largest economy is hoping to win developed-market status from global index provider MSCI, they said. REUTERS