Since the beginning of the year, capital outflows by foreigners have been confirmed in both the domestic stock and bond markets. Foreign investors continued the 'Sell Korea' trend for the sixth consecutive month in January, selling 687 billion KRW worth of domestic listed stocks.
According to the 'Foreign Securities Investment Trends in January 2025' announced by the Financial Supervisory Service on the 14th, foreigners net sold 687 billion KRW of domestic listed stocks last month. This marks six consecutive months of net selling since August last year. In the securities market, net selling of 273 billion KRW was confirmed in the KOSPI market and 414 billion KRW in the KOSDAQ market. By region, net selling was strong in Europe (-3.1 trillion KRW).
Accordingly, as of the end of January, the scale of domestic listed stocks held by foreigners was estimated at 707.8 trillion KRW. Although this is an increase of 34 trillion KRW compared to December last year, when a large-scale capital outflow was confirmed due to the sudden emergency martial law situation and the year-end seasonal characteristics, it did not reverse the net selling trend. Initially, until mid-January, the Korean stock market was expected to show a favorable performance, but the shock caused by DeepSeek is evaluated to have hindered it. The proportion of foreign holdings in the total market capitalization fell by 0.1 percentage points from the previous month to 26.9%.
Foreign investors also sold domestic bonds. Net redemption of listed bonds worth 1.66 trillion KRW was confirmed in January. This is the second consecutive month following December last year. They made net investments in government bonds worth 19 trillion KRW and net redemptions in Monetary Stabilization Bonds worth 3.3 trillion KRW. The scale of foreign holdings of listed bonds decreased by 1.9 trillion KRW from the previous month to 266.3 trillion KRW, accounting for 10.3% of the total.
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