Pods cannot access ELB type SVC public IP on HTTP if externalTrafficPolicy is Local


I would like to request some guidance from the k8s community.
My problem:
I setted up a new v1.17.9 cluster at OTC. I have created a basic nginx deployment for testing and exposed via a load-balancer service.
If externalTrafficPolicy is set to Local i cannot access the public IP of the ELB on port 80 from pods in this cluster. I can ping it, so routing should be OK. I only experience this issue if I am trying to access the public IP of the ELB, connecting to the internal cluster IP works fine.
If I set it back to externalTrafficPolicy: Cluster I can access the ELB on HTTP.

My question is:
Is this the expected behavior or there is some problem with the implementation of the k8s cluster?

Kubernetes version: v1.17.9
Cloud being used: Open Telekom Cloud

Thanks for any advice in advance.