Seoul, May 31 (IANS) Foreign selling of South Korean stocks listed on the benchmark Korea Composite Stock Price Index (KOSPI) reached a record high in May, while foreign investors poured a record amount into the tech-heavy KOSDAQ market, data showed on Sunday.

Offshore investors sold a net 44.71 trillion won (US$29.66 billion) worth of local stocks in May, surpassing the previous record of 35.74 trillion won in net selling set in March, according to data from the Korea Exchange (KRX), reports Yonhap news agency.

Foreign investors remained net sellers for 16 consecutive trading sessions from May 7 to May 29, marking the longest selling streak since February 2009, when they sold stocks for 17 straight trading days in the aftermath of the 2008 global financial crisis.

In contrast, retail investors purchased a net 36.09 trillion won worth of stocks, setting a record for monthly net buying.

Market watchers attributed the foreign sell-off largely to profit-taking following a tech rally, led by chipmakers Samsung Electronics Co. and SK hynix Inc.

Meanwhile, foreign investors bought a net 2.8 trillion won worth of shares on the secondary KOSDAQ market this month, exceeding the previous record of 2.7 trillion won in net buying set in July 2023.

Market observers said the strong inflow into KOSDAQ stocks was partly driven by expectations surrounding a newly launched investment fund that offers tax benefits and loss protection, which became available through local banks and securities firms earlier this month.

The fund, under the Korea National Growth Fund, aims to invest in companies specialising in artificial intelligence, rechargeable batteries, hydrogen, biotechnology and other related sectors.

Even as the benchmark Korea Composite Stock Price Index (KOSPI) continued its record-breaking rally toward the unprecedented 9,000-point mark, rising volatility is fuelling concerns that gains were increasingly concentrated in a handful of heavyweight stocks, bourse data showed Friday.

The KOSPI 200 volatility index, or VKOSPI, closed at 74.26, up 3.72 per cent from the previous session, according to data from the Korea Exchange. The KOSPI climbed 3.55 percent to finish at a record high of 8,476.15.

—IANS

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