Foreigners kept up net purchase in Korean bonds Jan-May

Offshore appetite for South Korean bonds remained robust for the fifth straight month in May with the eased geopolitical risk and stronger won adding appeal to Korean debt and pushing foreign ownership to a fresh record high.

According to data from the Financial Supervisory Service (FSS) on Monday, foreign investors net held 3.27 trillion won ($2.96 billion) in Korean bonds, counting out the repurchase of maturing debt.

By region, investors from Europe net invested 1.3 trillion won in Korean bonds while those from Asia 1 trillion won and the Middle East 400 billion won. By bond type, offshore investors purchased 2 trillion won worth in monetary stabilization bonds and 1.3 trillion won worth in government bonds.

Foreign investors unloaded stocks for the second straight month in May.

Offshore investors shed a total 380 billion won worth in stocks last month. By country, investors from the United Kingdom net sold 1.7 trillion won worth of Korean stocks, and those from Switzerland 400 billion won and Saudi Arabia 200 billion won.

U.S. investors net purchased 1.8 trillion won in Korean stocks last month. Investors from Canada and Australia also kept up buying.

As of end of May, foreign investors held 623.9 trillion won worth of Korean stocks, which accounts for 31.9 percent of the total market.

Investors in the U.S. were the largest holders with 259.5 trillion won - which represents 41.6 percent of total foreign ownership - followed by the United Kingdom with 48 trillion won (7.7 percent), Luxembourg with 39.8 trillion won (6.4 percent), Singapore with 31.5 trillion won (5 percent), Japan with 15 trillion won (2.4 percent), and China with 12 trillion won (1.9 percent).

The benchmark Korea Composite Stock Price Index (Kospi) finished Monday 1.16 percent down at 2,376.24. The index plunged to 2,370 level during intraday trading amid renewed concerns over U.S.-China trade war.

[ⓒ Maeil Business Newspaper & mk.co.kr, All rights reserved]