Foreign investment is rapidly exiting the leading semiconductor stocks in South Korea and Taiwan. With significant sell-offs in major tech firms like Samsung Electronics, SK Hynix, and TSMC, nearly 30 trillion won (approximately $23 billion) has flowed out this month alone.
According to the Korea Exchange and the Taiwan Stock Exchange (TWSE), from June 1 to June 10, foreign investors sold a net 11.82 trillion won (about $9 billion) worth of Samsung Electronics and 6.99 trillion won (around $5.4 billion) of SK Hynix. In Taiwan, foreign investors sold approximately 8.7 trillion won (about $6.7 billion) of TSMC and around 2.4 trillion won (about $1.8 billion) of Quanta, an AI server manufacturer. Additionally, Hon Hai Precision, known as Foxconn, saw a net sell-off of 160 billion won (about $123 million).
South Korea and Taiwan are central to the global AI semiconductor industry. Samsung Electronics and SK Hynix are key players in the AI semiconductor and high-bandwidth memory (HBM) markets, while TSMC is the world's largest foundry. Quanta and Hon Hai Precision are major companies responsible for producing NVIDIA AI servers.
This year, both countries' stock markets have gained prominence in the global arena, bolstered by increased AI investments. According to Bloomberg, as of June 10, Taiwan has become the fifth-largest stock market in the world, thanks to TSMC's soaring market capitalization, while South Korea ranks eighth, driven by Samsung Electronics and SK Hynix.
Market analysts are noting the simultaneous foreign sell-offs in key AI stocks from both countries this month. Reuters reports that foreign capital has exited the South Korean market by $12.63 billion and the Taiwanese market by $8 billion this month. The combined outflow from South Korea and Taiwan exceeds $20.6 billion (approximately 31.6 trillion won).
Analysts suggest that this shift in foreign investment is more likely a profit-taking strategy rather than a reaction to deteriorating market conditions. Yang Seung-soo, a researcher at Meritz Securities, stated, "Taiwan's IT companies continued to see sales growth in May, driven by increased AI demand. The structural strength of AI infrastructure demand and ongoing memory supply shortages persist." He added, "Recent foreign selling is more indicative of profit realization and portfolio rebalancing than a response to worsening market conditions."
* This article has been translated by AI.
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