Foreign capital kept flowing into the South Korean stock and bond markets on the back of the lasting optimism toward fundamentals of the economy, financial watchdog data showed Wednesday.
Foreign net buying in local listed stocks and bonds totaled 1. 16 trillion won (1.15 billion U.S. dollars) in June after recording 2.26 trillion won in May, according to the Financial Supervisory Service.
Foreigners bought a net 714 billion won worth of domestic shares in June, maintaining a buying trend for three straight months. Net foreign investment in bonds, or net bond buying minus maturing debts, reached 442 billion won in June, posting the fourth straight month of purchase.
Foreign holding of local listed stocks reached 437.5 trillion won, or 32.5 percent of the total market capitalization, as of end- June, with foreign ownership of local bonds reaching 97.6 trillion won, or 6.8 percent of the total.
Foreigners turned into net sellers from the mid-June after buying stocks in early June. Japanese investors bought stocks worth more than 500 billion won last month, with Chinese investors purchasing domestic shares worth 267 billion won.
The largest owner of stocks was U.S. investors who owned 171.9 trillion won worth of domestic shares, trailed by European Union investors with 128.3 trillion won, British investors with 36.2 trillion won and Luxembourg investors with 26 trillion won.
Despite the maturing debts worth 5.2 trillion won, net foreign investment in local listed bonds increased in June thanks to massive foreign net buying of bonds.
Foreign net buying of domestic bonds reached 5.6 trillion won in June, up 2.6 trillion won from a month earlier. The investors of the Republic of South Africa purchased bonds worth some 800 billion won, the largest net buyer of local bonds.
Luxembourg and U.S. investors sold domestic bonds worth 1 trillion won and 300 billion won respectively.
The largest holder of domestic bonds was U.S. investors who held 18.9 trillion won worth of bonds, which take up some 20 percent of the total foreign ownership. It was followed by Chinese investors with 13.3 trillion won and Luxembourg investors with 12. 4 trillion won.