Extreme volatility in South Korea’s stock market is exacting a political cost as retail investors nursing heavy losses from last week’s tech sell-off direct their ire at the country’s president.
Thousands of investors found themselves in the red and facing margin calls on leveraged positions last week as the Kospi benchmark fell nearly 40 per cent from its June peak amid a global tech rout. South Korea has been one of the world’s most volatile markets as an AI boom fuels bets on the country’s chipmakers.
The huge losses now pose a political risk for Lee Jae Myung, whose approval rating dropped to 44.5 per cent on Monday, near its lowest since he took office in June last year, according to polling agency Realmeter. Investors are blaming his administration for feeding a stock market frenzy and hastily approving risky derivative products.