Reducing Investment in Chinese Stock Market
Foreign investors are increasing their investment in South Korean EV battery and semiconductor stocks, while reducing their investment in the Chinese stock market. From Oct. 4 to Nov. 4, their net buying in KOSPI added up to 4.5425 trillion won. For reference, their net selling in the same market amounted to 16 trillion won in the first half of this year. KOSPI rose 9 percent in the one-month period after a 21 percent fall from January to September.
In that period, they reduced investment in TSMC and Chinese semiconductor stocks for geopolitical reasons related to tensions between the United States and China and between China and Taiwan. South Korean semiconductor stocks absorbed a large portion of the investment outflow.
At the same time, South Korean EV battery stocks are attracting much investment with U.S.-China trade disputes showing no signs of subsiding and the U.S. Inflation Reduction Act expected to become fully effective to adversely affect China in the industry.
In that period, their net buying totaled 932.7 billion won in Samsung SDI, 686.1 billion won in LG Energy Solution and 152.2 billion won in POSCO Chemical. As a result, the stock prices of the companies rose 32 percent, 33 percent and 36 percent, respectively.