Foreign investors sold a net 3.2 trillion won (approximately $2.4 billion) of stocks listed on the Korea Composite Stock Price Index (KOSPI) in May 2026, marking the highest monthly net selling on record, according to data from the Korea Exchange. This surpasses the previous record of 2.8 trillion won set in March 2020 during the COVID-19 pandemic.
The selling was driven by concerns over global trade tensions and a slowdown in the semiconductor sector, which is a key driver of South Korea's export economy. Foreign investors have been net sellers of KOSPI stocks for three consecutive months, with cumulative net selling reaching 5.1 trillion won in the April-May period.
Analysts attribute the sell-off to a combination of factors, including the strengthening of the U.S. dollar against the Korean won, which reduces the returns for foreign investors, and uncertainty over the Bank of Korea's monetary policy direction. The KOSPI index fell 4.2% in May, underperforming major global indices.
Despite the record selling, some analysts see potential for a rebound, noting that foreign selling often creates buying opportunities for domestic institutional investors. The Korea Exchange data also showed that foreign investors were net buyers of KOSDAQ stocks in May, suggesting a shift in preference toward smaller-cap growth stocks.
