Foreigners keep up buying on Kospi after near $4 bn net purchase in Nov

Foreign investors net bought 4.6 trillion won ($3.9 billion) from last month on the main Kospi market in a sharp U-turn from more than 31 trillion won in net sale over the earlier 10 months of the year to raise anticipation for their role in the lackluster year-end market.

According to data from the Korea Exchange on Friday, foreign investors net purchased 4.6 trillion won worth of Korean stocks between Nov. 1 and Dec. 3 in contrast to their selling spree throughout the year that amounted to a net 31.6 trillion won by October. They net bought 2.6 trillion won worth of stocks in November, their largest monthly purchases in the Kospi so far this year.

The “Buy Korea” momentum helped to defend the benchmark Kospi against heavy selling by retail and institutional investors amid jitters over the Omicron spread. The key index plummeted to an annual low of 2,839.01 last week and remains below the pivotal 3,000 mark.

Individuals net sold 3.9 trillion won worth of shares over the same period, while institutions offloaded 1.3 trillion won worth. Pension funds, meanwhile, net bought 313.5 billion won worth last month after authorities issued a verbal intervention about overreaction to external factors.

Samsung Electronics and SK hynix were the top picks by offshore investors who respectively purchased 1.8 trillion won and 1.1 trillion won worth shares in the country’s top two chipmakers.

Other top buys included major electronics and IT names like Krafton (717.4 billion won), Kakao (497.9 billion won), Samsung SDI (403.2 billion won) and SK IE Technology (283.5 billion won).

Market analysts observe that the Korean stock markets appeal to foreign investors as they have been under lengthy correction reflecting in the shift in monetary policies across the world due to inflationary pressure.

Investor sentiment in Korea has also recovered on eased apprehension about Omicron threat.

Whether the change in foreign portfolio can lift the market movement is yet to be seen, analysts added.

Kospi closed a tad higher at 2,973.25 on Monday as moderate buying by foreigners helped to offset institutional selling.

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