Offshore investors offloaded a net $31.83 billion worth of South Korean stocks in May, marking a record monthly high. This follows a $2.68 billion sell-off in April, with investors divesting from chipmakers and other major companies after a significant rally.
Record foreign outflows from South Korean stocks can signal waning international confidence in the market, potentially impacting local asset prices and currency stability. The shift from stocks to bonds suggests a move towards safer assets amid market uncertainty or profit-taking.
Foreign investors continued a significant selling trend in South Korean stocks during May, offloading a record $31.83 billion worth of local equities. This outflow follows a $2.68 billion sell-off in April, according to data from the Bank of Korea. The substantial selling is attributed to investors cashing in gains from chipmakers and other market heavyweights after an extended rally. For the first five months of the year, foreign selling in the stock market totaled $77.83 billion. In contrast to stock sales, foreign investors were net buyers of bonds in May, purchasing $5.68 billion worth, an increase from $0.55 billion in April. Cumulatively, foreign investors sold a net $26.15 billion in local securities in May, up from $21.3 billion in net sales in April.