SEOUL, June 26 (AJP) — Foreign investors sold a record 47 trillion won ($30.5 billion) worth of Korean stocks in May, pushing their net sales in the first five months 10 times their 2025 annual outflow and explaining the stubbornly weak won versus the U.S. dollar, data showed Friday.
Despite their heavy selling, their holdings in Korean shares and share in market cap surged to a record high to reflect their cherry-picking in heavyweight blue chips.
According to data released Friday by the Financial Supervisory Service (FSS), overseas investors were net sellers of 47.02 trillion won in listed Korean shares in May, the largest monthly net outflow on record.
They sold a net 49.04 trillion won on the benchmark KOSPI while buying a net 2.02 trillion won on the junior KOSDAQ.
The cumulative net selloff reached 114.22 trillion won during the first five months of the year, more than ten times last year's full-year net outflow. Their relentless selling continued in June, with a net 41.5 trillion won worth of KOSPI shares so far this month.
The dollar, as result, has soared 2.3 percent to 1,541.8 won Thursday, up 2.3 percent from May-end, and 7.2 percent from December-end.
Despite the heavy selling, a rally in large-cap stocks, particularly semiconductor shares, lifted the market value of foreign investors' holdings by 730.9 trillion won from a month earlier to a record 2,852.3 trillion won at the end of May. Foreign ownership also climbed to an all-time high of 35.3 percent of South Korea's total stock market capitalization.
By region, investors from the Americas accounted for the largest net sales at 33.2 trillion won, followed by Europe at 7.4 trillion won, the Middle East at 1.1 trillion won and Asia at 100 billion won.
U.S. investors led the selling with net outflows of 28.86 trillion won, accounting for more than half of total foreign net sales during the month. They nevertheless remained the largest foreign holders of Korean equities, with holdings worth 1,188.0 trillion won at the end of May, accounting for 41.7 percent of all foreign-owned stocks.
Canadian investors sold a net 4.27 trillion won, while investors from Norway and Hong Kong were net buyers, purchasing 2.29 trillion won and 2.01 trillion won, respectively.
Foreign appetite for Korean bonds, however, remained strong.
Overseas investors recorded net bond purchases of 8.79 trillion won in May after purchasing 11.72 trillion won worth of bonds and redeeming 2.92 trillion won of maturing debt, marking a second straight month of net investment.
European investors were the biggest buyers with 5.7 trillion won, followed by Asian investors with 2.0 trillion won.
Most purchases were concentrated in government bonds. Foreign investors recorded net purchases of 9.89 trillion won in sovereign debt while trimming holdings of quasi-government bonds. They favored bonds with remaining maturities of one to five years (7.02 trillion won) and more than five years (4.30 trillion won), while reducing holdings of securities with less than one year remaining.
At the end of May, foreign investors held 333.6 trillion won worth of listed Korean bonds, equivalent to 11.7 percent of the total market.
Asian investors accounted for the largest share of foreign bond holdings at 133.3 trillion won, narrowly ahead of European investors at 132.0 trillion won. Government bonds accounted for 94.7 percent of foreign-held Korean bonds.
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