Foreigners Sell off Korean Shares

  • By Kwon Soon-wan

    October 20, 2023 10:47

    Foreign investors seem gradually to be leaving the Korean stock market as the gap in benchmark interest rates between Korea and the U.S. remains at a historic two percent.
    They have been selling their Korean stocks and bonds since August.
    According to the Financial Supervisory Service on Thursday, foreigners sold W1.2 trillion worth of shares on the main Korea Composite Stock Price Index and W498 billion worth on the junior Kosdaq last month (US$1=W1,357).
    That left them with W663.7 trillion worth of Korean stocks as of late September, accounting for 26.7 percent of total market cap.
    Americans held W274.3 trillion worth to rank at the top and account for 41.3 percent of foreign ownership, followed by Europeans with W203.7 trillion (30.7 percent), Asians with W88.8 trillion (13.4 percent) and Middle Easterners with W20.6 trillion (3.1 percent).
    Last month foreigners bought W8.016 trillion worth of listed bonds in Korea but received W8.653 trillion in principal payments, resulting in a net redemption of W637 billion, a second month of outflows. They owned W242.4 trillion worth of Korean bonds, down by W100 billion compared to August and accounting for 9.8 percent of listed bonds.
    Middle Eastern investors purchased W300 billion worth of bonds, and Asians and Americans W300 billion each. But Europeans redeemed W500 billion. Asians owned W114.2 trillion worth of Korean bonds to account for 47.1 percent of the total and Europeans W71.4 trillion to account for 29.4 percent.
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