SEOUL, KOREA - The market value of shares held by foreigners has hit a record-high level. According to the Korea Exchange on July 28, the market capitalization accounted for by foreign investors was 432,476.1 billion won as of July 25, the highest level since October 30 last year when the figure was 431.8 trillion won.
The volume of shares held by foreigners is an important leading index that precedes the KOSPI together with KOSPI's total market capitalization. The foreigner-held market cap approached 350 trillion won in July 2007, but fell precipitously to 141 trillion won in November 2008 following the global financial crisis. At the time, the KOSPI index fell to the 900 level from as high as 2,000. As the index regained to the 2,200 level in 2011, the foreigner-held market value increased to more than 400 trillion won.
Analysts said the KOSPI index may finally break the 2,000 level. LIG Investment & Securities research center head Ji Gi-ho said, "During the years 2004 to 2005, the foreigner-held market value and total market capitalization rose by a large margin before the KOSPI broke the 1,000 level. By September this year, it is likely the KOSPI to reach 2,231, the record-high level."
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