Foreign investors sell 2.59 trillion won of Korean stocks while Wall Street rises

The KOSPI's 1.98% loss against the Nasdaq's 0.45% gain is a gap of about 2.4 percentage points in one session ^[1][5][13]. It opened on a day when the overnight news favoured Korean stocks, with oil and global bond yields both lower ^[18]. Korean bond prices fell instead ^[11]. Inside the session the index opened 1.11% lower, briefly turned positive, then fell into the close ^[4].

Foreign net selling of 2.59 trillion won equalled about 13% of the 19.69 trillion won that traded ^[2][14], on volume Yonhap described as light ^[6]. Add the institutions and the two groups sold a net 3.26 trillion won ^[15], of which individuals took 2.56 trillion ^[3]. Every net sale has a net buyer, so the remaining 700 billion won or so sat with investor groups outside the three Yonhap listed ^[16]. The selling reached past technology, with 525 decliners against 332 advancers, about 61% of the issues that moved ^[17].

The record supports three readings of why foreigners sold. Yonhap's framing is concern over bond yields at multidecade highs ^[1]. The analyst it quoted offered two other causes. "The KOSPI came under renewed pressure amid rising international oil prices and U.S. Treasury yields," Lee Kyung-min, an analyst at Daishin Securities, said. "Investors also took a wait-and-see approach ahead of Samsung Electronics' preliminary earnings report, prompting both foreign and institutional investors to become net sellers." ^[7] His first sentence describes a global move that, by the same report's account, had begun to reverse overnight ^[18], so it holds only as a delayed reaction to earlier sessions. His second is positioning ahead of a dated event, and some of the heaviest losses sat close to it: Samsung Electro-Mechanics, a Samsung affiliate, fell 4.24%, and SK Square lost 1.64% ^[9].

The currency cuts against reading the day as foreign money leaving Korea. The won gained 3.2 won to 1,340.4 per dollar, about 0.24% ^[10][12]. Sellers converting 2.59 trillion won of proceeds into dollars would have pushed it the other way, so either most of that money stayed in won or other flows outweighed it. The report does not say which.

I think one session supports a narrower claim than the idea that yields now set the direction of Korean equities. Korean stocks fell alongside Korean bond prices on a day Wall Street rose, and, according to Lee, the biggest sellers had a company-specific reason to wait a day ^[7][8]. The yield explanation fails if foreigners turn net buyers once Samsung's guidance is out and local yields have not come down. It holds if they keep selling after the number.