Samsung and SK hynix make up 86% of foreigners' 203.7 trillion won net sale of KOSPI stocks

Subtract the two chipmakers and 27.7 trillion won is left for every other stock on the main board ^[14]. The total was a net 203.6977 trillion won, according to the Korea Exchange ^[1], and about 176 trillion won of it was Samsung Electronics and SK hynix ^[2], so those two names account for about 6.4 times the net foreign selling of all the rest combined ^[15]. We think a reversal, when it comes, shows first in those two tickers' daily flows, because a tail that size cannot move the total much by itself.

The brokerage's list of triggers sorts into two kinds. The US midterms on Nov. 3, the US-Iran talks and Anthropic's listing work on conditions across the whole market, while the chipmakers' earnings speak to the two stocks directly ^[9]. For the earnings, Hyundai Motor Securities said that with doubts growing over whether memory chip profit growth can continue, the supply-demand outlook the two companies present and their assessment of China's CXMT will matter, and that additional shareholder returns such as further buybacks could also help ^[12].

The ordering of the rest is awkward. Hyundai points to June, when large US tech stocks and the KOSPI corrected together ahead of SpaceX's listing, and says fears of capital outflows could weigh on the market before Anthropic's debut, with relief only after the listing ^[10]. On Iran, it judges that the country's bargaining power will peak before the midterms, and it sees a strong chance of a dramatic agreement just ahead of the vote ^[11]. Both calls sit in the same report as Kim Jae-seung's conclusion. "There is no big event in sight that would immediately turn around foreign net selling," Kim said ^[8].

The domestic bid is underwater. At the low on the 13th the index stood 15.6% under the 7,000 end of the range where retail net buying clustered ^[16] and 30.5% under the 8,500 end ^[17]. The report adds that individuals' spare cash is moving into interest-bearing products and US equities ^[6].

Our view is that the brokerage's gradual path is the likelier one. Hyundai expects flows to improve step by step through the chip earnings, the midterms and the Anthropic listing ^[13], and the 86% concentration means the first step depends on two companies' guidance. The counter-thesis is the Iran deal, which Hyundai itself rates as likely before Nov. 3 ^[11] and which could bring foreign money back faster than a gradual path allows.

Two outcomes would show us wrong. One is net foreign buying in Samsung and SK hynix within days of the late-month earnings, which would mean the first trigger was enough. The other is the 27.7 trillion won outside them growing while the two stabilise, which would mean the selling had broadened and the concentration story no longer fit.