The prohibition of short-selling on all listed stocks will be extended for six more months through March 15 next year, according to the Financial Services Commission (FSC).
The FSC introduced the prohibition in mid-March as the COVID-19 outbreak roiled the domestic financial market.
The COVID-19 pandemic here worsened in February and March, with the daily caseload peaking at 909 on Feb. 29.
Since then, the outbreak slowed down, but the number of confirmed COVID-19 cases soared in triple digits for the past two weeks due to cluster infections traceable to church services and a massive rally on Aug. 15.
The FSC said in a statement that the decision to extend the short-selling ban was made in response to an expanded market volatility, caused by concerns here about the recent COVID-19 resurgence.
The benchmark KOSPI slipped 1.05 percent Thursday. It declined 2.46 percent on Aug. 18 and 3.66 percent on Aug. 20 respectively.
Short-selling refers to the sale of stocks by borrowing them in anticipation of price fall, before repaying the borrowed shares when the price goes down. It has been seen as one of the main culprits for the stock market rout.
To bolster stocks, the FSC also decided to extend the increased ceiling on treasury stocks, which can be repurchased by listed companies, for six more months through next March.
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