Foreign investors turned buoyant on Korean securities in March amid high expectations for the outcome of the back-to-back summit meetings with North Korea in following months that could significantly remove geopolitical risks.
A report from Financial Supervisory Service on Monday showed that offshore investors purchased a net 123 billion won ($114.5 million) worth of Korean stocks in March, a sharp reversal from a net selling of 3.96 trillion won a month earlier. They stayed long on Korean bonds for the third straight month, net purchasing 3.66 trillion won in Korean debt in March.
In the stock market, they net sold 200 billion won worth stocks in the country’s main Kospi market while buying 300 billion won worth in the tech-heavy, secondary Kosdaq market.
Investors from the United States were the top buyers of Korean stocks at 600 billion won, followed by those from Luxembourg and Hong Kong at 300 billion won, respectively. Investors from the Netherlands sold off 1.5 trillion won while those from Singapore and Australia each shed 300 billion won.
Offshore investors accounted for 31.9 percent of the country’s total market cap at 625.2 trillion won as of the end of March. U.S. investors, with 25.9 trillion won, held the dominant share among foreigners at 41.4 percent. It was followed by the U.K. at 7.6 percent (47.7 trillion won), Luxembourg at 6.5 percent (40.7 trillion won), Singapore at 5.2 percent (32.8 trillion won) and Ireland at 3.9 percent (24.5 trillion won). Japan trailed behind at 2.4 percent (14.8 trillion won) and China 1.9 percent (11.8 trillion won).
Foreigners net bought 3.66 trillion won worth of bonds in March, with new holdings amounting to about 1 trillion won after excluding 2.6 trillion won holdings that are nearing maturity. They bought 104.5 trillion won or 6.2 percent of all Korean debts. Asian countries invested 1.7 trillion won and European countries 1.2 trillion won.
By Kim Dong-eun and Kim Hyo-jin
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