"Semiconductors Set KOSPI 6,000 in Motion"... Retail and Foreign Investors Bet on a Rally

Retail and foreign investors are betting on a rise in the domestic stock market. In particular, money is flowing into semiconductor-related exchange-traded funds (ETFs). Brokerage analysts say that as concerns over the Middle East ease and expectations recover for the Artificial Intelligence (AI) semiconductor industry, the foreign selling cycle has likely entered its final phase.
According to Koscom on the 22nd, the ETF most heavily bought by retail investors over the past month (from February 20 to March 19) was the KODEX 200 ETF, with net purchases totaling 1.1557 trillion won. This was followed by 925.6 billion won in KODEX Leverage ETF, 800.4 billion won in KoAct KOSDAQ Active ETF, 402.9 billion won in Timefolio TIME KOSDAQ Active ETF, and 316.7 billion won in Mirae Asset TIGER 200 ETF. These products all track major domestic stock indices.
Since the start of this month, retail investors have been net buyers of 16.9182 trillion won in the domestic equity market, using the heightened volatility triggered by the Middle East situation as an opportunity to buy on dips. Foreign investors, by contrast, have turned more aggressive sellers, offloading a net 16.1533 trillion won over the same period. However, analysts note that in the past, foreign selling has tended to persist for a certain period and then come to an end, suggesting that the current flow of funds may be in the latter stage of the cycle.
In fact, over the past month foreign investors have been net buyers of ETFs that profit from a rise in the domestic stock market, including 124.7 billion won in KODEX Leverage ETF, 68.7 billion won in Mirae Asset TIGER KOSDAQ150 Leverage ETF, 64.1 billion won in KODEX MSCI Korea Total Return ETF, and 60.5 billion won in TIGER Leverage ETF.
Hyun-guk Ahn, a researcher at Hanwha Investment & Securities, said, "We estimate that U.S.-based funds have been net sellers for six consecutive months through March," adding, "Historically, excluding 2008 and 2020, stretches of continuous net selling have tended to end after about six months."
Many expect the semiconductor industry to lead any turn in the domestic market toward an uptrend. Recently, global AI bellwethers such as Micron Technology and Oracle have reported earnings that beat market consensus, reinforcing the view that the AI-driven semiconductor cycle is not yet over.
Over the past month, retail investors have been net buyers of 697 billion won in Mirae Asset TIGER Fn Semiconductor TOP 10 ETF, 343.7 billion won in Mirae Asset TIGER Semiconductor TOP10 Leverage ETF, and 194.2 billion won in HANARO Fn K-Semiconductor ETF, among others. Foreign investors have also bought 143.6 billion won of TIGER US Philadelphia Semiconductor NASDAQ ETF and 7.8 billion won of Mirae Asset TIGER Fn Semiconductor TOP 10 ETF, indicating that optimism toward the semiconductor sector remains.
Jong-min Kim, a researcher at Samsung Securities, noted, "The rally in earnings upgrades for the Korea Composite Stock Price Index (KOSPI), led by Samsung Electronics and SK hynix, is still under way. Micron Technology's recent earnings surprise is boosting expectations for Samsung Electronics' preliminary first-quarter results, which are due early next month." He added, "Although the prolonged Middle East crisis is heightening fears of a resurgence in inflation, it is still too early to assume an immediate economic shock."
Even so, some warn that, as the domestic market becomes increasingly dependent on semiconductor stocks, investors must be prepared for the possibility of rising uncertainty in the AI industry.
Choi Gwang-hyeok, a researcher at LS Securities, pointed out, "Despite the recent series of uncertainty factors, strong export growth in Korea's semiconductor sector has supported both the Korean economy and stock prices." He continued, "However, Korea's exports and economy are now closely tied to the U.S. AI cycle. If uncertainty around U.S. AI intensifies or a bubble bursts, the impact on Korea could be severe."
[email protected] Im Sang-hyeok and Bae Han-geul Reporter