A view of Yeouido’s financial district, often referred to as “Korea’s Wall Street.” (Yonhap)
SEOUL, Aug. 21 (Korea Bizwire) — South Korean brokerage firms are moving to resume overnight trading of U.S. stocks as early as November, more than a year after the service was abruptly suspended in the wake of a market shock.
According to industry officials on Thursday, securities firms reached a tentative agreement to restart the service in November and are now finalizing operational preparations. The timing was set to ensure the broadest possible participation among firms.
The service was suspended in August 2024 after “Black Monday” market turmoil, when Blue Ocean, a U.S. alternative trading system (ATS) that had exclusively handled Korean overnight orders, unilaterally canceled transactions. The move left roughly 90,000 local accounts with canceled trades worth about 630 billion won ($460 million), sparking investor outrage.
To avoid a repeat, Korean brokerages are signing contracts with multiple U.S. ATS platforms, including newcomers Bruce and Moon, to diversify beyond Blue Ocean. Some firms have already conducted test trades to verify stability.
In addition, firms are building systems that allow one-click “rollback” functions to swiftly cancel and settle trades in emergencies — a safeguard that was absent for some players during last year’s disruption, leading to delays and uneven responses.
The service was halted in August 2024 following the “Black Monday” market turmoil, when Blue Ocean — the U.S. alternative trading system (ATS) solely responsible for processing Korean overnight orders — abruptly voided transactions, wiping out trades worth about 630 billion won ($460 million) across roughly 90,000 accounts and triggering investor outrage. (Image courtesy of Yonhap)
While no regulatory approval is required to resume trading, authorities have stressed the need for robust investor protection given the scale of the past losses. Officials may yet demand stronger safeguards, which could push the restart beyond November.
The Korea Financial Investment Association has coordinated discussions among 18 brokerages in recent months, reconciling initially divided views.
Industry sentiment shifted toward resuming quickly after the New York Stock Exchange delayed its extended trading hours plan and Korea’s Financial Supervisory Service concluded earlier this year that it would be difficult to hold brokerages legally liable for last year’s losses.
If the preparations proceed smoothly, Korean investors could regain access to overnight U.S. stock trading within the year.
Ashley Song (ashley@koreabizwire.com)
