South Korean President: It will take time for the stock market to stabilize following its sharp rally, and he urged regulatory authorities to address the controversy over leveraged ETFs.

South Korean President Lee Jae-myung said South Korea’s stock market, after a sharp rally in a short period, needs time to stabilize. Speaking at a policy meeting with senior government officials in Seoul on Wednesday, Lee stated, “South Korea’s domestic stock market is currently quite unstable. Given that the market has seen an unprecedented sharp rally in such a short timeframe, it will take time and a certain level of volatility to stabilize.” Lee acknowledged recent controversies surrounding leveraged ETFs, and urged heads of the Financial Supervisory Service (FSS) and Korea Exchange (KRX) to promptly address the issues and formulate follow-up response measures. Market analysts expect regulators will take steps to curb the impact of such high-risk products on market stability, including potentially raising the minimum margin requirements for investing in leveraged ETFs. South Korea’s largest opposition party, the People Power Party, on Tuesday accused the Lee Jae-myung administration of setting ambitious stock market goals while ignoring accumulating leverage risks, thereby encouraging excessive risk-taking.