Expectations for Semiconductor Market Recovery Continue... Foreign Investors Net Buyers of Korean Stocks for 6 Consecutive Months

'International Finance and Foreign Exchange Market Trends Since April'
Total Net Inflow of 19 Billion USD Since November Last Year

On the 7th, the KOSPI index opened at 2718.17, up 41.54 points (1.55%) from the previous trading day, as dealers were working in the Hana Bank dealing room in Jung-gu, Seoul. On the same day, the won-dollar exchange rate started trading at 1356.5 won, down 6.3 won from the previous trading day. Photo by Kang Jin-hyung aymsdream@

As expectations for a recovery in the global semiconductor industry continue, foreigners have been net buyers of Korean stocks for six consecutive months.

According to the "International Finance and Foreign Exchange Market Trends since April 2024" released by the Bank of Korea on the 10th, the net inflow of foreign investment funds into domestic stocks last month amounted to $1.92 billion.

Foreign investors have been net buyers of Korean stocks for six consecutive months, starting from November last year ($2.64 billion), December ($2.52 billion), January this year ($2.51 billion), February ($5.59 billion), and March ($3.84 billion). The total net inflow from November last year to April this year reached $19 billion.

Yoon Seung-wan, head of the Capital Movement Analysis Team at the Bank of Korea's International Department, explained, "Despite concerns over the Federal Reserve's delayed interest rate cuts and heightened geopolitical risks in the Middle East, the continued expectations for a recovery in the global semiconductor industry sustained the net inflows."

Foreign investment in domestic bonds last month saw a net inflow of $2.12 billion. In March, bond funds experienced a net outflow of $3.39 billion, but following a large-scale maturity at the beginning of March, investments focused on long-term bonds led to a shift to net inflows.

The total net inflow of foreign investment funds in securities, combining stocks and bonds, was $4.03 billion, a significant increase compared to $440 million in March. Yoon explained, "The relatively small net inflow in March was due to a large-scale government bond maturity amounting to $6 billion at the beginning of March," adding, "Funds that had been withdrawn due to the maturity normalized in April."

The won-dollar exchange rate at the end of April was 1,382 won, up 34.8 won from March. This rise was influenced by expectations of delayed rate cuts by the U.S. Federal Reserve, concerns over the expansion of the Middle East conflict, and the weakening of the yen. However, on the 8th, the won-dollar exchange rate fell to 1,361.5 won, 1.1 won lower than in March. This narrowing of the increase is attributed to eased tensions in the Middle East and a recovery in investor sentiment following the U.S. Federal Open Market Committee (FOMC) meeting.

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