SINGAPORE, June 19 (Reuters) - South Korea's stock market accessibility for short-selling has improved and has no major issues, MSCI said on Friday as investors brace for next week's market classification from the global index provider and hope the country gets an upgrade.

The stock market of Asia's fourth-largest economy is currently categorised as an emerging market by MSCI, despite many other metrics indicating its developed-economy status.

South Korea has been chasing after developed market status for some years and investors hope next week's classification will include South Korea being added to the watch list for an upgrade.

The country in March lifted a full market-wide ban on short selling of stocks for the first time in five years, which had been cited by foreign investors and MSCI as a major factor hindering market access.

In its annual market accessibility review released on Friday, MSCI said there has been an improvement in South Korea's short-selling market accessibility, nudging up the rating to "+" or no major issues, improvements possible, from "-" or improvements needed.

The benchmark index KOSPI .KSII has had a stellar year, surging 24%, making it the best performing Asian stock market in 2025 as political clarity and optimism around corporate reforms buoy investor sentiment. An upgrade in the coming years would lead to significant inflows, analysts say.

(Reporting by Ankur Banerjee in Singapore; Editing by Stephen Coates)

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