0730 Korea Institutional Views Update

English summary

Foreign influence has further strengthened. As a large amount of retail money flows into leveraged ETFs on single stocks, retail funds directly allocating to ordinary stocks such as Samsung Electronics and SK Hynix have significantly decreased. In the past, retail spot buying could partly absorb foreign selling pressure and balance foreign capital flows; now this force has weakened significantly, making the Korean stock market more sensitive to foreign capital flows, and foreign influence on stock prices has correspondingly increased. Funding disturbance update: After the Korean government announced regulatory measures, retail inflows into single-stock leveraged ETFs have shown signs of cooling, with ETF trading share beginning to fall and market sentiment gradually improving. However, the following still exists: * ETF trading share remains at a relatively high level; * ETF turnover is still significantly higher than spot stocks; * The impact on market prices remains very significant. Therefore, the effectiveness of regulation needs to be continuously monitored. The Korean government's latest regulatory measures are reflected in six aspects (pay attention to implementation nodes). At present, the regulatory direction is clear, but the intensity is still insufficient. ...