South Korea's AI stock frenzy cools: trading volume plunges 70% from May peak, foreign investors accelerate exit

PANews reported on October 11, citing BusinessTimes, that South Korea was a poster child for the global AI boom for most of this year, but by nearly every metric Korean stocks are now rapidly losing investor attention. Market trading volume has plunged 70% from its late-May peak, foreign investors are exiting quickly, and local retail investors are also pulling back. Behind this reversal is the Korean stock market's over-reliance on Samsung Electronics and SK Hynix.

Richard Tang of Julius Baer said: "We are observing capital increasingly flowing back into U.S. equities, which has led to continued foreign outflows from Korean stocks." In addition, Phillip Wool, head of portfolio management at Rayliant Global Advisors, said: "I think the biggest challenge for most investors, especially those who only recently entered the Korean market because of the memory chip trade, is that the easy money under this theme has already been taken off the table." He said his fund has been taking profits on Korean AI stocks and is currently underweight SK Hynix and Samsung Electronics.