Foreigners' Net Selling of Domestic Stocks for 3 Consecutive Months in July...Net Investment in Bonds Since the Beginning of the Year

[Asia Economy Reporter Park Jihwan] Last month, foreign investors net sold 3.778 trillion KRW worth of domestically listed stocks. The large-scale net selling by foreigners in the domestic stock market is interpreted as a result of accelerated discussions on tapering (gradual reduction of quantitative easing) due to concerns over US inflation.

According to the 'Foreign Securities Investment Trends in July 2021' released by the Financial Supervisory Service on the 13th, foreigners net sold 4.15 trillion KRW in the KOSPI last month. On the other hand, they net bought 372 billion KRW in the KOSDAQ. This marks three consecutive months of net selling following May (-10.167 trillion KRW) and June (-499 billion KRW).

By region, investors from Europe (-3 trillion KRW), Asia (-400 billion KRW), and the Americas (-100 billion KRW) net sold. Investors from the Middle East (500 billion KRW) net bought. By country, Kuwait (400 billion KRW) and the United States (200 billion KRW) net bought. Investors from the United Kingdom (-2.3 trillion KRW) and the Cayman Islands (-400 billion KRW) net sold.

As of the end of last month, foreigners' holdings of domestically listed stocks amounted to 811 trillion KRW (29.4% of market capitalization), a decrease of 31.3 trillion KRW compared to the end of the previous month.

Last month, foreigners net purchased 9.29 trillion KRW worth of domestically listed bonds. The net investment trend has been maintained since January this year. As of the end of last month, foreigners' holdings of domestically listed bonds reached a record high of 195.3 trillion KRW (8.9% of total bond balance), an increase of 6.4 trillion KRW compared to the end of the previous month. Foreigners' bond holdings have set new record highs every month since January.

By region, investors from the Middle East (4 trillion KRW), Europe (2.2 trillion KRW), the Americas (1.8 trillion KRW), and Asia (1.6 trillion KRW) net invested. By type, net investments were made in government bonds (7.3 trillion KRW) and Monetary Stabilization Bonds (2.1 trillion KRW). By remaining maturity, net investments were made in bonds with 1 to less than 5 years (5.3 trillion KRW) and over 5 years (4.2 trillion KRW), while bonds with less than 1 year (-200 billion KRW) saw net withdrawals.

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