À̹ÌÁö È®´ë Foreigners bought the largest amount of Korean stocks last month in almost two years on the back of improved investment sentiment on risk assets and undervaluation of local shares, the central bank said on Wednesday.
According to the Bank of Korea, foreign capital aimed to invest in Korean stocks totaled $3.34 billion in January, marking the second straight month of inflow since December. It is also the largest amount of investment since May, 2017, when foreigners bought $3.36 billion worth of shares.
Market watchers noted that massive foreign buying in the stock market came as investment sentiment on risk assets improved this year and bargain-hunting after undervalued Korean shares.
Outflow of funds from the bond market hit $3.23 billion in January, the largest withdrawal since $3.47 billion in September 2017. The BOK said that massive foreign selling in the bond market came as there were funds with approaching maturity and profit-taking for their short-term portfolio.
It is the first time in three months that foreigners turned to net sellers in the bond market, data showed.
Overall, foreign inflow to Korean securities market reached a total $120 million in January.
The foreign exchange market, meanwhile, was relatively stable in January. The variation of the won-dollar rate last month narrowed to 3.4 won from 4.6 won in December, the BOK said. The changes in the won-dollar exchange rate also averaged 0.31 percent in January, narrowing from 0.41 percent in December.
The won finished at 1,124.7 against the U.S. dollar on Monday, up 0.8 percent from 1,115.7 in the previous month.
The premium credit default swap (CDS) for Korea¡¯s benchmark five-year foreign exchange stabilization bonds averaged 36 basis points in January, down 3 basis points from a month ago.
Foreign exchange swap rate stood at -1.15 percent as of Monday, up from -1.33 percent in December on favorable foreign liquidity condition. Cross-currency interest rate swap stood at 1.18 percent, up 0.04 percent during the same period on rising swap rate.
By Lee Yu-sup and Lee Eun-joo
[¨Ï Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]