Foreign investors continued to offload Korean stocks despite a rebound in daily trading volume, a Korea Exchange data showed Wednesday.
Analysts cited the lingering uncertainties surrounding the ongoing US-China trade war that has dampened global investor sentiment behind the move.
According to the bourse operator, foreigners were net sellers of shares on the benchmark Kospi worth nearly 1.4 trillion won ($1.2 billion) from Nov. 7 to Wednesday. The offloading observed throughout 10 consecutive trading sessions, marked the second longest selling streak since the July 31 to Aug. 19 period.
They offloaded a net 334.2 billion won on Wednesday alone.
Offshore investors overall have shifted to a selling spree since August when the Kospi fell below the 2,000 mark, weighed on by various pressures stemming from the US-China trade war and Japan’s announcement in July to impose trade restrictions on key materials needed for production of Korea’s chips and displays. They had largely remained net buyers of Kospi shares in the January-July period.
The data comes amid a rebound in Kospi’s average trading volume and stock prices, which had remained sluggish for months, concerning investors.
Since the main board rebounded above 2,100 on Nov. 1, it has remained in terrain above that level for 14 consecutive sessions, as of Wednesday. The Kospi ended nearly 1 percent lower from the previous closing at 2,125.32 on Wednesday.
The Kospi’s daily average turnover clocked in at 5.4 trillion won in the 14-session period.
Despite immediate signs of recovery, analysts warned that there are still major hurdles to overcome in order to significantly minimize market volatility.
“It seems the current rebound in Kospi is likely to face hurdles with increased uncertainties surrounding the US-China trade negotiations,” said Lee Kyung-min, an analyst at Daishin Securities.
“The intensifying Hong Kong protests and the US Senate’s decision to pass legislation for protection of human rights in Hong Kong seems to have irked China,” he added.
By Jung Min-kyung (firstname.lastname@example.org