Cumulative foreign net selling on the KOSPI exceeds 203 trillion won; "Other Corporations" defend market with 64 trillion won in net purchases
Samsung Electronics completes 15 trillion won buyback; SK hynix executes 89% of plan—focus shifts to next source of buying support
The KOSPI, which had been buoyed by massive share buybacks from the nation’s top two semiconductor firms, faltered under intense foreign selling pressure. As Samsung Electronics completed its 15 trillion won buyback program and SK hynix executed approximately 90% of its 40 trillion won plan, the massive buying capacity that previously absorbed foreign sell-offs has significantly diminished. With cumulative foreign net selling exceeding 203 trillion won this year, market attention is focused on whether a new investment pillar can replace corporate buybacks.
According to the Korea Exchange on the 13th, the KOSPI closed at 6035.35, down 348.89 points (5.46%) from the previous trading day. Foreign investors net sold approximately 4.533 trillion won in the main board. Roughly 94% of the sell-off was concentrated in the electrical and electronic sectors, with large-cap semiconductor stocks leading the index’s decline.
Total foreign net selling on the KOSPI has surpassed 203 trillion won so far this year. While the massive buyback programs of Samsung Electronics and SK hynix absorbed a significant portion of the foreign selling volume, a shift in the market's supply-demand structure is now inevitable as these plans reach their final stages.
"Other Corporations" Absorb Selling Pressure with Semiconductor-Heavy Buying
According to Korea Exchange data tracking investor sentiment, foreign investors net sold 203.6494 trillion won on the KOSPI from January 2 to October 13 (excluding ETFs, ETNs, and ELWs).
During the same period, retail investors net purchased 100.4741 trillion won, "Other Corporations" net purchased 64.1741 trillion won, and institutional investors net purchased 38.2711 trillion won. Essentially, domestic investment entities divided and absorbed the volume offloaded by foreign investors.
The scale of net purchases by "Other Corporations" is particularly striking. This investor category reflects treasury stock acquisitions by general business corporations. The large-scale buybacks conducted by Samsung Electronics and SK hynix this year had a substantial impact on these figures.
The concentration of buying in semiconductor stocks is also evident in individual ticker data. From August 20 to September 28, Other Corporations net purchased 40.7531 trillion won in Samsung Electronics and SK hynix alone. During the same window, the combined net selling from foreign and retail investors totaled 39.3035 trillion won.
Corporate buybacks absorbed the semiconductor shares dumped by foreign and retail investors, acting as a buffer against downward price pressure. Unlike typical investment demand, these stocks were purchased according to pre-set corporate plans, making them a defining characteristic of this year’s semiconductor liquidity flow.
Samsung Electronics Completes 15T Won Buyback; SK hynix Reaches 89% Execution
The primary concern is that this buying support is nearing its end.
Samsung Electronics disclosed on the 12th that it had completed its 15 trillion won share buyback program as of the 6th. The program, which served as a major counterweight to intensifying foreign selling, has officially concluded.
The situation at SK hynix is similar. Of the company's 40 trillion won buyback plan, 35.7295 trillion won had been executed as of the 12th, representing 89.3% of the total target.
The remaining capacity stands at approximately 4.2705 trillion won. While the program is not yet entirely finished, the fact that the majority of funds have already been deployed means the market can no longer rely on the same scale of buying support as before.
The buybacks by these two companies were significant because they created actual demand for shares regardless of semiconductor industry cycles or earnings outlooks. Even as foreign selling continued, the companies reduced the burden of oversupply by purchasing fixed volumes of their own stock.
However, with Samsung’s program finished and SK hynix’s remaining volume dwindling, the foundation for absorbing foreign selling has weakened. Even if earnings expectations for semiconductor firms remain solid, price volatility could spike if there is a lack of investors willing to buy the shares.
Post-Buyback Vacuum: Pension Funds and Investment Trusts Remain Net Sellers
As corporate buybacks wind down, attention is shifting to whether institutional and retail investors have the capacity for further purchases.
While total institutional net purchases reached 38.2711 trillion won this year, a breakdown of the sub-sectors reveals a different story.
Financial investment (proprietary trading) net purchased 69.2204 trillion won, but pension funds net sold 9.0758 trillion won, insurance companies net sold 7.2292 trillion won, and investment trusts net sold 6.9669 trillion won.
This is why it is difficult to conclude that long-term investment capital is steadily flowing into the market based on aggregate institutional figures alone. Since "financial investment" buying reflects various short-term trading objectives, it cannot be interpreted as the same type of stable demand provided by pension funds or equity-linked funds.
Retail investors absorbed foreign selling by net purchasing over 100 trillion won this year. However, as demonstrated today, retail buying has limits when it comes to defending the index against concentrated foreign sell-offs totaling trillions of won in a single day.
The key for the market moving forward will be the stabilization of foreign selling and whether institutional investors—such as pension funds and investment trusts—can fill the void left by corporate buybacks.
Samsung Electronics and SK hynix’s buybacks provided a significant cushion in a market hit by foreign selling pressure. Now, as direct corporate buying fades, the Korean stock market has entered a phase where it must translate earnings expectations into actual investment demand.
