Foreigners Sell Over 7 Trillion Won in Just One Week...

[Asia Economy Reporter Song Hwajeong] Foreign investors have turned to a selling trend in the domestic stock market after just one week. The weekly net selling volume reached 7 trillion won.

According to the Korea Exchange on the 15th, foreign investors net sold approximately 7.0973 trillion won in the domestic stock market during the week from the 9th to the 13th. Foreign investors sold 7.0453 trillion won in the KOSPI market and 51.7 billion won in the KOSDAQ market.

The stock most purchased by foreign investors last week was LG Chem. Foreign investors net bought LG Chem worth 396.7 billion won last week. This was followed by Samsung SDI with a net purchase of 261 billion won. Other net purchases included Kakao Games (125.5 billion won), Naver (NAVER·115.8 billion won), Celltrion (96.9 billion won), Kia (95.3 billion won), SK IE Technology (90.1 billion won), SK Telecom (79.4 billion won), Samsung Biologics (73.8 billion won), and POSCO (POSCO·55.5 billion won).

The stock most sold by foreign investors last week was Samsung Electronics. Foreign investors net sold Samsung Electronics worth 5.5739 trillion won last week. This was followed by SK Hynix with sales of 2.0177 trillion won. Other top net sales included Krafton (288.7 billion won), Samsung Electronics Preferred Shares (247.8 billion won), SK Bioscience (165.2 billion won), Kumho Petrochemical (66.2 billion won), HK Innoen (56.2 billion won), EcoPro (44.5 billion won), Kakao (44 billion won), and DB HiTek (38 billion won).

Labor Researcher Roh Donggil of NH Investment & Securities explained, "The large-scale net selling by foreign investors in the domestic stock market was influenced by the sharp increase in new COVID-19 cases in Korea, accelerated discussions on tapering (asset purchase reduction) following strong U.S. July employment data, and global investment banks lowering their semiconductor sector weightings." He added, "In particular, the sharp rise in new COVID-19 cases in Korea increased the likelihood of an extension of social distancing measures, which triggered a rise in the KRW-USD exchange rate. This was linked to foreign stock capital outflows, further intensifying the depreciation of the Korean won." He further noted, "The semiconductor sector, which holds a high weighting in the domestic benchmark, suffered a double blow from both market-wide and sector-specific selling."

Foreign investors' selling of domestic stocks is expected to continue for the time being. Researcher Roh said, "The fact that the tapering schedule for Q3 will be concretized is less favorable for foreign investor supply and demand trends. While we do not see a high likelihood that tapering will lead to massive capital outflows from emerging markets as in 2013, it is necessary to be cautious about the possibility of a stronger dollar at the early stage of monetary policy normalization, and foreign capital outflows focused on large-cap stocks may continue."

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