Foreign ownership of South Korean stocks has surged to its highest level in five years and nine months, reaching 37.18% of total market capitalization on January 7. This increase was primarily driven by offshore investors making significant net purchases in industries like shipbuilding, defense, and nuclear power. Notably, foreign investors acquired 14.1 trillion won (US$9.7 billion) worth of Samsung Electronics shares in the second half of last year alone.
Investments in the semiconductor sector in the latter part of last year, followed by purchases in shipbuilding, defense, and nuclear power industries this month, contributed to the rise in foreign stock holdings. Popular shares this month included Hanwha Ocean, Doosan Enerbility, and Naver. The interest in shipbuilding and nuclear power sectors stemmed from expectations of substantial orders amidst a global demand surge, while the defense industry saw increased activity possibly due to geopolitical tensions related to U.S. President Donald Trump.
South Korean stocks closed higher recently, with technology and brokerage shares leading the gains, resulting in a fresh peak. The benchmark Korea Composite Stock Price Index (KOSPI) rose by 37.54 points, or 0.76 percent, to close at 4,990.07. Trade volume was significant at 595.6 million shares worth 29.6 trillion won (US$20.2 billion), with institutions and foreigners making notable stock purchases.
The KOSPI index briefly surpassed the 5,000-point mark for the second consecutive session, reaching an intraday record of 5,021.13. The Korean won also strengthened against the U.S. dollar during this period. Institutions and foreigners were net buyers of stocks, with individual investors being net sellers. The market saw a positive trend with more winners than losers, reflecting overall optimism in the South Korean stock market.
