Foreign investors extended their net selling streak to eight months in March, even as they scooped up semiconductor and defense stocks.
They offloaded a net 2.16 trillion won ($1.46 billion) in Kospi and Kosdaq shares over the month, according to the Korea Exchange on Tuesday, selling on 11 of 20 trading days.
The pace accelerated on Monday, with 1.18 trillion won shed in a single session amid the full resumption of short-selling and escalating trade tariff concerns tied to US President Donald Trump.
Despite the broader selloff, foreign investors made Samsung Electronics their top net purchase, buying 1.48 trillion won worth of shares.
Samsung slid nearly 4 percent on Monday due to short-selling pressure but then rebounded to hover near the 60,000-won level. Optimism over a recovery in memory prices from the second quarter — driven by supply-demand improvements — has fueled foreign inflows, according to market experts.
Defense stocks also saw strong foreign interest, with Hanwha Aerospace emerging as the second-largest net buy at 406.8 billion won.
Despite announcing a record 3.6 trillion won capital increase on March 20, the company continued to attract foreign inflows for a fourth consecutive session.
Analysts see Hanwha Aerospace delivering strong performance through at least 2028, buoyed by existing orders from Poland.
They also point to its recent investments as a long-term growth driver — an outlook seemingly validated by continued foreign buying.
Korea Aerospace Industries ranked third in net purchases at 246.4 billion won, while Hanwha Systems placed ninth at 62.5 billion won.
Funds appear to be flowing into the shipbuilding and defense sectors, which are insulated from the reciprocal tariff risks set to be announced on Wednesday. Meanwhile, a 25 percent tariff on automobiles is slated to take effect Thursday.
Shipbuilding and defense stocks climbed despite Monday’s market downturn. Shipbuilders are seen as beneficiaries of US restrictions on Chinese shipping firms, while defense stocks are rallying on stronger earnings expectations.
“For the Kospi to sustain an upward trajectory, the market must first digest the earnings season,” said Han Ji-young, an analyst at Kiwoom Securities.
“The outlook will hinge on how much earnings forecasts improve after late April, particularly from key sectors such as semiconductors, defense and shipbuilding—especially Hanwha Aerospace and HD Hyundai Heavy Industries.”
By Park Han-na (hnpark@heraldcorp.com)
