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Foreigners sell S. Korean stocks, bonds on Fed's tapering

English.news.cn   2014-03-07 13:08:25

SEOUL, March 7 (Xinhua) -- Foreigners sold stocks and bonds in South Korea last month as the U.S. Federal Reserve's tapering of its quantitative easing caused jitters in the global financial market, especially in emerging economies with weak fundamentals, financial watchdog data showed Friday.

Foreign investors sold a net 1.2 trillion won (1.13 billion U.S. dollars) worth of local stocks in February, maintaining their selling spree for the fourth straight month, according to the Financial Supervisory Service (FSS).

The foreign selling came amid the continued stimulus cut in the United States. The Fed scaled back its monthly bond purchases by 10 billion U.S. dollars further to 65 billion dollars last month after reducing by the same size in the prior month.

Emerging economies with weak economic fundamentals, including Argentina and Turkey, saw their currencies drop against the dollar as foreign capital flowed out of those nations on worries about the Fed's tapering.

The largest seller was U.S. investors who sold domestic shares worth 960.2 billion won after buying 287.2 billion won worth of stocks. Luxembourg and British investors offloaded stocks worth 746.1 billion won and 230 billion won respectively.

Foreign holdings of local stocks expanded 12.3 trillion won from a month earlier to 425.7 trillion won as of the end of February, accounting for 32.2 percent of the total market capitalization.

The largest owner was U.S. investors who held shares worth 168. 9 trillion won, or 39.7 percent of the total foreign ownership. It was trailed by EU investors with a 29.7 percent share and British investors with an 8.9 percent share.

Bond investment, or net bond buying minus maturing debts, logged a net outflow of 1.8 trillion won last month as large-scale bonds worth 2.8 trillion won matured.

Foreign holdings of local bonds were 93.9 trillion won as of end-February, down 1.7 trillion won from a month earlier. Foreign ownership took up 6.6 percent of the total listed bonds last month.

Editor: Shen Qing
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