Foreigners Switch to 'Saja' in Just 4 Weeks

[Asia Economy Reporter Song Hwajeong] Foreign investors have returned to net buying in the domestic stock market after 4 weeks.

According to the Korea Exchange on the 27th, foreign investors net purchased about 453.6 billion KRW in the domestic stock market during the week from the 21st to the 24th. They bought 50.6 billion KRW in the KOSPI market and 403.8 billion KRW in the KOSDAQ market, respectively.

The stock most purchased by foreign investors last week was Kakao. Foreign investors net bought Kakao for 87.9 billion KRW last week. This was followed by Celltrion, which they bought for 87.5 billion KRW. Other net purchases included Samsung SDI (82.2 billion KRW), NCSoft (61.7 billion KRW), Alteogen (55.9 billion KRW), LG Chem (44.2 billion KRW), Samsung C&T (44.1 billion KRW), Hyundai Motor (37.3 billion KRW), MedPacto (35.8 billion KRW), and Green Cross (28.8 billion KRW).

The stock most sold by foreign investors last week was Samsung Electronics. Foreign investors net sold Samsung Electronics for 148.3 billion KRW last week. They also sold Samsung Electronics Preferred shares for 120.9 billion KRW. Other top net sales by foreign investors included Solus Advanced Materials (55.2 billion KRW), LG (36.5 billion KRW), Korea Electric Power Corporation (KEPCO) (32.5 billion KRW), Kia Motors (29.5 billion KRW), POSCO (26.7 billion KRW), LG Display (25.4 billion KRW), Shinhan Financial Group (25.4 billion KRW), and KT&G (25.1 billion KRW).

It is analyzed that dividend expectations are reflected in the year-end stock market. Roh Dong-gil, a researcher at NH Investment & Securities, said, "Dividend-related expectations are largely reflected at the current KOSPI level," adding, "Expectations are focused on stocks within the KOSPI 200 that are expected to improve their dividend policies rather than traditional dividend stocks." Researcher Roh added, "In an environment where foreign investors increase domestic exposure mainly through futures, the relative returns of large-cap stocks may somewhat slow down until the end of the year," and "The time when the relative returns of large-cap stocks can rise again is expected to be early 2021, when foreign investors are expected to switch to net buying in the spot market."