"Foreign Investors' Selling Blitz" Amid Repeated Plunges, KOSPI Is the World's Worst Performer This Month

Price momentum weakens after July plunge
Losses deepen as foreign investors sell more than KRW 10 trillion

The KOSPI, which has recently continued to weaken amid a wave of panic selling, posted the worst return among major global stock markets this month. The KOSDAQ also ranked near the bottom, and the overall domestic market was weak, with 7 out of every 10 locally listed stocks declining.

According to an analysis by Yonhap News Agency of data from the Korea Exchange and other sources, the KOSPI fell 17.11% from Oct. 1 to 16, the lowest return among major global stock indexes over the same period.

Indonesia's IDX Composite Index had the steepest decline at 14.59%, followed by China's Shenzhen Composite Index at 7.40% and the KOSDAQ at 7.14%. By contrast, Brazil's Bovespa Index posted the highest return, rising 10.24%. It was followed by Russia's RTS Index at 7.17%, Switzerland's SMI at 4.06%, and India's Sensex at 3.10%.

On the 19th, the KOSPI, KOSDAQ, and won-dollar exchange rate are displayed on an electronic board in the dealing room at Hana Bank's headquarters in Jung-gu, Seoul. Yonhap News Agency

While indexes in emerging markets such as Brazil, Russia and India ranked among the top performers, the KOSPI, which has a large weighting in semiconductors, as well as Taiwan's Weighted Index, down 1.73%, and Japan's Nikkei 225, down 2.14%, were broadly weak.

Except in March, immediately after the U.S.-Iran war broke out, and in July, when it plunged amid a global semiconductor correction, the KOSPI had maintained a top-tier monthly return among major global stock markets for most of this year. In April, it surged by as much as 30.61%.

However, as the index lost momentum after July, it rose just 3.40% in August and 0.26% in September, before plunging more than 17% this month. It also lost its title as the top-performing market year to date to Taiwan's Weighted Index, which had posted a cumulative return of 62.66% as of Oct. 16. The KOSPI's return was 34.50%, leaving it behind Poland's WIG Index, which was up 36.66%.

The weakness in the domestic stock market is attributed to concerns about the growth prospects of the artificial intelligence (AI) industry. Recently, bonds issued by AI neocloud company CoreWeave plunged, fueling concerns over the credit risks of data center contractors. AI company Anthropic saw its third-quarter revenue growth slow from the previous quarter. The AI companies' chronic profitability problems are also coming to the fore.

Meanwhile, foreign investors recorded net sales on the benchmark KOSPI market for eight consecutive trading days starting Oct. 2, selling a total of KRW 18.1308 trillion worth of shares.

By market, 652 KOSPI-listed stocks and 1,247 KOSDAQ-listed stocks fell. A total of 1,120 stocks, or 40.58%, dropped by at least 5%; 588, or 21.30%, fell by at least 10%; and 127, or 4.60%, plunged by at least 20%.

This content was produced with the assistance of AI translation services.