Foreigners buy Korean stocks for 3rd straight month in Jan. on chip sector recovery hopes

SEOUL, Feb. 13 (Yonhap) -- Foreign investors scooped up Korean stocks in January for the third consecutive month on the back of hopes for a recovery in the chipmaking sector, central bank data showed Tuesday.

Offshore investors bought a net US$2.51 billion worth of local stocks last month, following $2.52 billion worth of purchases the previous month and $2.64 billion buying in November, according to the data from the Bank of Korea (BOK).

The central bank said foreigners' net stock purchases came amid the outlook for a rebound in the chipmaking sector despite woes over a delay in restrictive monetary stances in major economies.

Last year, foreign investors bought a net $8.16 billion worth of local stocks, a turnaround from selling of $6.09 billion in 2022 and $17.44 billion in 2021, the central bank data showed.

Foreigners sold a net $1.89 billion worth of local bonds last month, compared with net selling of $7.9 million a month earlier.

Meanwhile, the premium on credit default swaps (CDS) for South Korea's five-year dollar-denominated currency stabilization bonds amounted to 29 basis points in December, up from 27 basis points the previous month. A basis point is 0.01 percentage point.

The CDS premium reflects the cost of hedging credit risks on corporate or sovereign debt. A rise implies a drop in the credit spreads of sovereign bonds and higher borrowing costs.

sam@yna.co.kr
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