Foreign investors net bought South Korean equities in August, ending seven-month sell-off
In August, offshore investors purchased a net US$0.4 billion of South Korean stocks, reversing a seven-month streak of net selling.
According to the Bank of Korea, offshore investors became net purchasers of South Korean shares in August, adding US$0.4 billion after a prolonged period of net selling that began in January. This reversal followed a massive US$20.7 billion net sell-off in July. The buying was attributed to better market sentiment, bolstered by solid earnings from large U.S. technology firms and heightened attention to Middle East tensions, while investors remained wary of over-investment in AI infrastructure.
Conversely, foreign investors dumped US$4.53 billion of Korean bonds in August, increasing the sell-off from the US$0.96 billion recorded the month before. The Korean won appreciated, ending the month at 1,368.6 per dollar versus 1,424.0 a month earlier. These movements highlight the sensitivity of Korean capital markets to global risk factors and earnings trends abroad.
Why it matters
The shift signals renewed foreign confidence in Korean equities, affecting capital flows and the won's value.
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