As the domestic stock market continues its 'honeymoon rally' with seven consecutive days of gains since the inauguration of the new government, foreign investors have poured significant funds into the semiconductor sector. In particular, foreign investors have bet on the rise of SK hynix and Samsung Electronics.
According to the Korea Exchange on the 12th, the most heavily net-bought stock by foreign investors during the period following the inauguration of Lee Jae-myung's government (from June 4 to June 11) was SK hynix (869.1 billion won). Following that was Samsung Electronics (791.7 billion won).
The net purchase volume for both stocks totaled 1.5 trillion won, accounting for about 34% of the total net purchases by foreign investors (4.3 trillion won) during this period. In other words, one-third of the foreign capital entering the domestic stock market was focused on these two major semiconductor stocks.
Notably, Samsung Electronics has made a remarkable return to the top ranks of net purchases by foreign investors. Last month, it was the stock that foreign investors sold the most, with a net sell of 1.27 trillion won. However, this month, as U.S.-China trade negotiations have progressed and the global semiconductor market has improved, Samsung Electronics' net purchase amount has also surged.
Kim Dong-won, head of research at KB Securities, noted, 'This year, HBM shipments increased by 94% compared to the previous year, and the average selling price rose by 21%, which will have a positive impact on the performance of Samsung Electronics and SK hynix.' He added, 'The 12-month forward price-to-book ratio (PBR) of Samsung Electronics and SK hynix is 0.92 times and 1.39 times, respectively, indicating a need to focus on upward potential in the second half rather than risk of decline.'
There are also criticisms that with foreign capital concentrated on major semiconductor stocks, it is limited to interpret the recent index rise as an overall improvement in the market's strength.
Park Sang-hyun, a researcher at iM Securities, explained, 'Recently, foreign funds have been concentrated on sectors with significant price rise potential, and because they are the leading stocks driving the market, it may appear that the market has improved immediately.'
Although the index continues to rise, the flow of net buying by foreign investors is somewhat weakening. On the first day of Lee Jae-myung's government, the 4th, the net purchase amount by foreign investors reached 1.199 trillion won, marking the highest level in 10 months. However, just four trading days later, on the 11th, it decreased to 373 billion won, indicating a slowdown in purchasing momentum.
Hyundai Motor Securities stated, 'Excluding the period of the Donghak Ant Movement between 2020 and 2021, foreign net purchases have acted as a factor in determining the direction of the KOSPI.' There is an analysis suggesting a trend of coupling between the KOSPI index and the cumulative amount of net purchases by foreign investors.
Meanwhile, during the same period (from June 4 to June 11), the stock that the 'big players' of domestic securities, pension funds, net bought the most was Kakao (63.5 billion won). Kakao's stock price rose from the 36,000 won range on the 9th of last month to the 51,000 won range within a month. In just six trading days, the stock price increase rate reached 20.37%. Considering that it had been on a downward trend for over a year since last year, this is a significant rebound.
The surge in Kakao's stock price is attributed to the introduction of a stablecoin in won and the Lee Jae-myung government's drive for artificial intelligence (AI) new businesses. Expectations that subsidiary companies like Kakao Pay will benefit from these policies have led to a rising trend in the overall group's stock prices. On the 10th, the first regulatory bill for promoting the virtual asset (cryptocurrency) industry, the 'Digital Asset Basic Law', was introduced, which has positively influenced investor sentiment towards the AI industry.
Kim Ji-hyun, a researcher at Heungkuk Securities, stated, 'While Kakao is not directly related to policies regarding digital assets, there is anticipation that if ecosystems combine within the Kakao Pay service, it could impact the growth of Kakao Pay's transaction value (TPV), contributing to the recent rise in stock prices.'
He went on to say, 'While there are burdens due to the rapid rise in stock prices, the government's policy direction is expected to improve the operating environment, alleviating concerns about growth potential in the second half of the year.'