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China Merchants Securities stops making market for South Korea ETF

The Shanghai-listed withdrawal comes after South Korea’s benchmark Korea Composite index surged 116.0% earlier in 2026 before plunging more than 28% on Monday, triggering circuit breakers and trading halts.

Reported · Written up by our desk · ETFs

China Merchants Securities has stopped providing market-making liquidity for the mainland’s only South Korea-focused exchange-traded fund, the Huatai-PineBridge China-Korea Semiconductor ETF, according to Shanghai Stock Exchange filings cited by SCMP Economy.

SCMP Economy reported the brokerage withdrew as a liquidity provider barely a month after taking the role on June 17. China Merchants said the move was purely commercial and did not reflect its view on market direction, adding it also ended market-making services for five other QDII products tied to the Nikkei 225 and the Nasdaq 100.

The decision follows sharp swings in Seoul. SCMP Economy noted the Korea Composite Stock Price Index rose 116.0% from about 4,224 points early this year to a record 9,385.59 on June 19, before falling more than 28.0% to 6,516.27 on Monday, amid eight marketwide circuit breakers and 37 Sidecar trading halts that temporarily pause algorithmic trading during volatility.

QDII funds allow approved institutions to invest overseas within regulator-set limits, and the ETF market-making pullback highlights how China’s fund liquidity providers are responding to stress in cross-border equity markets, SCMP Economy said.

Latest closeNasdaq Comp. 25,881.95 ▼1.5%|Nikkei 225 68,751.51 ▲1.5%

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