▲ Kospi
Foreign investors are continuing their buying streak in the Kospi market this week, raising expectations for a full-fledged return.
Foreigners have maintained a net buying trend for three consecutive sessions starting from the first trading day of this week on the 20th up to today.
The total net purchases from the 20th to the 21st amounted to 836 billion won.
As of 11:31 AM today (the 22nd), the scale of net purchases has grown further, reaching 1.9686 trillion won.
Even on a weekly basis, the scale of foreign net purchases is expanding.
Foreigners net sold 19.837 trillion won worth of shares in late June to the first week of July (June 29 – July 3), but the net selling decreased to 4.116 trillion won in the following week, the second week of July (July 6–10).
They then turned to net buyers in the third week of July (July 13–16) with 21.5 billion won, and further increased their net purchases this week.
This buying has been concentrated mainly in the semiconductor sector.
Foreigners have been net buyers in the Kospi electrical and electronics sector for three consecutive trading sessions from the 20th through today.
Over the two days on the 20th and 21st, foreign net purchases in the electrical and electronics sector reached 1.0926 trillion won.
This is analyzed to be the result of a spreading perception that price attractiveness has increased as Kospi underwent corrections, plunging 20% this month up to the previous day.
On the 21st local time, Morgan Stanley maintained its target at 9,000 points, stating that the Kospi, which had plummeted earlier this month, is nearing its bottom.
Recently, JPMorgan also mentioned the solid fundamentals of South Korean companies and maintained its 12-month forward Kospi target at 12,500 points.
In particular, expectations that Kospi's earnings momentum will continue, as the semiconductor industry conditions remain robust, appear to be stimulating buying sentiment.
Morgan Stanley suggested the recent correction in memory semiconductor stocks as a buying opportunity, stating that long-term concerns over memory semiconductor shortages intensifying in 2027 and 2028 are stronger than ever.
In addition, the stabilization of the won-dollar exchange rate is also improving foreign investment sentiment.
As of 3:30 PM yesterday, the won-dollar exchange rate stood at 1,473.4 won, down 5.0 won, extending its downward trend for the sixth consecutive trading session on a weekly trading basis.
Yesterday afternoon, it briefly dropped to 1,471.1 won, recording its lowest level since May 11 (1,465.6 won).
Securities firms predict that additional selling pressure will be limited given the large scale of foreign selling previously seen.
However, as major U.S. big tech companies begin releasing their earnings this week, some maintain a cautious stance that additional buying must be watched closely since foreign supply and demand could vary depending on the earnings results.
Investors are on edge as Alphabet's earnings are set to be released early tomorrow Korean time.
Alphabet is one of the four hyperscalers—along with Microsoft (MS), Amazon, and Meta Platforms—that are actively investing in AI infrastructure such as data centers.
Alphabet previously issued this year's capital expenditure guidance at $180 billion to $190 billion, which is roughly double last year's $91.4 billion.
If it presents large-scale investment plans for next year following this year, the upward momentum of the semiconductor sector could unfold in earnest.
Conversely, if Alphabet cuts its capital expenditure, doubts over AI growth potential could grow, leading to additional stock price corrections.
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