Foreigners, Two Consecutive Weeks of 'Palja'... Net Selling Exceeds 2 Trillion Won

[Asia Economy Reporter Song Hwajeong] Foreign investors continued their selling streak in the domestic stock market for the second consecutive week, with the scale of sales increasing significantly.

According to the Korea Exchange on the 1st, foreign investors net sold approximately 2.045 trillion KRW in the domestic stock market during the week from the 26th to the 30th of last month. Foreign investors sold 1.7015 trillion KRW in the KOSPI market and 343.4 billion KRW in the KOSDAQ market, respectively.

The stock most purchased by foreign investors last week was LG Chem. Foreign investors net bought LG Chem for 169.6 billion KRW last week, followed by Kakao with a net purchase of 137.9 billion KRW. Other net purchases included POSCO (931 billion KRW), Samsung Electro-Mechanics (86.9 billion KRW), Samsung Biologics (76.2 billion KRW), Hyundai Steel (50.8 billion KRW), SK Bioscience (49.9 billion KRW), E-Mart (47.9 billion KRW), Samsung C&T (46.0 billion KRW), and SK IE Technology (30.6 billion KRW).

The stock most sold by foreign investors last week was Samsung Electronics. Foreign investors net sold Samsung Electronics for 783.3 billion KRW last week, followed by SK Hynix with sales of 365 billion KRW. Other top net sales included LG Household & Health Care (137.4 billion KRW), Hyundai Mobis (134.9 billion KRW), Hyundai Motor (116.2 billion KRW), NAVER (106.0 billion KRW), Kakao Games (66.7 billion KRW), SK Innovation (62.9 billion KRW), OCI (45.9 billion KRW), and HMM (43.4 billion KRW).

It is difficult to expect strong foreign capital inflows in the near term. Moon Jongjin, a researcher at Kyobo Securities, stated, "Indicators that have historically shown a high correlation with foreign capital inflows include domestic exports, overall corporate earnings forecasts as leading economic indicators, and exchange rate attractiveness." He added, "In the short term, there are concerns about peak-out in both domestic exports and corporate earnings. Compared to other countries, the relatively strong U.S. economic momentum, expectations for tapering (asset purchase reduction) and interest rate hikes in the second half of the year, and the outlook for a continued strong dollar environment make it difficult to see the exchange rate as attractive." Researcher Moon concluded, "It is judged that strong foreign capital inflows are unlikely in the near term," adding, "If the overall index's strong upward momentum is limited, it is effective to focus on individual stocks within small and mid-cap stocks that are rapidly improving their performance."