Foreigners Switch 'Fate' in Just One Week... Buy KOSPI, Sell KOSDAQ

[Asia Economy Reporter Song Hwajeong] Foreign investors turned to a selling trend in the domestic stock market after just one week. While they recorded a slight net purchase in the KOSPI market, they showed net sales in the KOSDAQ market.

According to the Korea Exchange on the 13th, foreign investors net sold about 110.7 billion KRW in the domestic stock market during the week from the 7th to the 11th. Foreign investors bought 177.9 billion KRW in the KOSPI market but sold 289.4 billion KRW in the KOSDAQ market.

The stock most purchased by foreign investors last week was LG Chem. Foreign investors net bought LG Chem for 215.6 billion KRW last week. This was followed by Kakao with a net purchase of 182.4 billion KRW. Other net purchases included Naver (NAVER·138.3 billion KRW), SK Innovation (134.1 billion KRW), SK Hynix (117.8 billion KRW), Kia (108.7 billion KRW), Celltrion (40.7 billion KRW), L&F (27.3 billion KRW), Pan Ocean (27.0 billion KRW), and Samsung SDI (25.9 billion KRW).

The stock most sold by foreign investors last week was Samsung Electronics. Foreign investors net sold Samsung Electronics for 207.5 billion KRW last week. In the previous week, foreign investors were the largest buyers of Samsung Electronics, but their stance reversed within a week. This was followed by SK IE Technology with net sales of 59.0 billion KRW. Other top net sales by foreign investors included Daehan Electric Wire (52.4 billion KRW), Kumho Petrochemical (45.6 billion KRW), Hyosung Advanced Materials (40.3 billion KRW), Doosan Fuel Cell (39.0 billion KRW), Hyosung TNC (38.1 billion KRW), GS Construction (37.9 billion KRW), Mando (35.2 billion KRW), and LG Display (31.1 billion KRW).

With market attention focused on the upcoming U.S. Federal Open Market Committee (FOMC) meeting scheduled for the 15th-16th, opinions suggest that the stock market is unlikely to experience unexpected shocks. Kim Younghwan, a researcher at NH Investment & Securities, said, "The U.S. consumer price index for May, announced on the 10th, rose 5.0% year-on-year, marking the highest inflation rate since the 2008 financial crisis, drawing attention to the Federal Reserve's monetary policy." He added, "Recently, there have been increasing expectations in the stock market that the tapering (asset purchase reduction) period may be brought forward, but comparing this with statements from Fed officials, it seems the market is ahead of the Fed. Therefore, the likelihood of the stock market experiencing unexpected shocks is low."

Park Seokhyun, a researcher at KTB Investment & Securities, said, "The market's interest in the June FOMC meeting lies in how much the Fed will move toward tightening." He added, "The faster the Fed moves, the greater the market uncertainty and volatility risk will be; conversely, if the Fed's patience is confirmed once again, market stability could be reinforced. The outcome is expected to be closer to the latter." Park also noted, "Above all, since there are still aspects of the U.S. employment environment that require further confirmation, the Fed is unlikely to show impatience at the June FOMC meeting."