The Democratic Party convened an emergency meeting on November 6 with government officials to discuss measures for stabilizing the financial market and protecting investors after the KOSPI index fell below 5000.
The meeting, held in the National Assembly, included discussions on strategies to restore the KOSPI to its previous level. Attendees from the government included Deputy Prime Minister and Minister of Economy Lee Hyeong-il, Financial Services Commission Chairman Lee Ok-yeon, and Financial Supervisory Service Chairman Lee Chan-jin.
Kim Min-seok, the party leader, pointed out that the recent market decline was an excessive reaction by the domestic stock market due to its structural characteristics, particularly the heavy weighting of certain industries like semiconductors.
"I believe the structural characteristics of the Korean stock market, which is heavily influenced by industries such as semiconductors, have amplified volatility and led to an excessive response from the market," Kim said. He added that the party would ensure that the government's market stabilization measures yield tangible results for the public and would expedite legislative efforts to create a resilient capital market.
Han Byeong-do, the floor leader, assessed that external factors, such as the recent U.S. midterm elections, contributed to the excessive reactions in the domestic stock market.
"The domestic stock market reacted to the midterm election results. We will initiate legislative measures for fundamental improvements in the capital market to reduce volatility and enhance investor protection," Han stated, emphasizing the need to strengthen the economy's foundational strength and maintain market safety and trust.
Deputy Prime Minister Lee Hyeong-il proposed measures to mitigate market volatility caused by excessive short selling and pledged to focus on investor protection.
"The government is continuously monitoring global semiconductor industry trends and policies from major countries, maintaining a high level of vigilance to assess political and financial flows in real-time," Lee said. He announced that to prevent the amplification of market volatility due to excessive short selling, the requirement for a 140% collateral ratio on credit loans would be temporarily waived for three months starting November 9.
Following the meeting, the Democratic Party held a closed-door session to decide on supporting the government's forthcoming measures.
Spokesperson Lee Yong-woo stated, "The party will support the measures announced and pursued by the government and will discuss various options to address any necessary issues."
* This article has been translated by AI.
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