Departing Foreigners... Market Cap Weight Falls Below 30%

Change in Fortune, Dropping to 29.86%
KOSPI Market Share Falls to the 33% Range

[Asia Economy Reporter Hwang Junho] The market capitalization ratio of foreign investors in the domestic stock market has fallen below 30%. This is the result of a sharp decline in the attractiveness of the domestic stock market, raising concerns about a 'Sell Korea' trend (selling domestic stocks).

According to the Korea Exchange on the 10th, the foreign ownership ratio based on market capitalization in the domestic stock market dropped to 29.86% as of the 6th. This is the first time in 5 years and 1 month since June 22, 2016, that it has fallen into the 29% range. On the next trading day, the 9th, it slightly improved to around 29.90%, but it still has not surpassed the 30% threshold.

In particular, the reduction in foreign ownership in the KOSPI market is noticeable. The foreign ownership ratio in the KOSPI market fell to the 33% range for the first time since August 16, 2016. On the 9th, the foreign ownership ratio was 33.79%, whereas at the beginning of the year it was 37.11% (January 11). The KOSDAQ recorded 9.93%. Foreign investors have net sold 21.21 trillion won in KOSPI and 1.38 trillion won in KOSDAQ since the beginning of this year.

The foreign market capitalization was about 786 trillion won based on the closing price on the 9th. Since June, whenever the foreign market capitalization exceeded 800 trillion won, the KOSPI surpassed 3300, but as the foreign market capitalization has continuously decreased, the KOSPI has been trapped again around the 3200 level.

Kim Daejun, a researcher at Korea Investment & Securities, analyzed, "The biggest burden currently is that foreigners are withdrawing from the domestic stock market," adding, "They have net sold 22 trillion won in the domestic stock market this year, with 5 trillion won sold just last month."

This content was produced with the assistance of AI translation services.