Foreign investors sustain Seoul stock market

Special Report:Global Financial Crisis

SEOUL, Feb. 6 (Chinese media) -- Seoul stock market is sustaining the global economic recession better than other markets thanks to foreign investors despite grim outlooks on the South Korea's economy, the Korea Times reported Friday.

Seoul stocks rose over 3 percent in January, contrary to a 3.7 percent drop worldwide on average and a 9.5 percent decline in the U.S. stock market.

According to the Korea Times, foreign investors are the main driver of the stock rise. Since Jan. 28, foreign investors in the Seoul stock market marked net buying for seven consecutive days. Their purchase totaled 878 billion won (638 million U.S. dollars) in December and 770 billion won (560 million U.S. dollars) in January.

The most remarkable thing about the foreign investors, the Korea Times said, is that most of them are from the United States and Europe. Investors from those regions took up over 70 percent of foreign buying in the Seoul stock market.

It is still dubious, however, whether the "Buy-Korea" movements of foreign investors would continue, the Korea Times reported.

"Foreign investors aren't buying shares in other emerging Asian countries. It means foreign investors may be buying Seoul shares to gain from the foreign exchange rate," KB Investment Securities said. The advantage of Seoul stocks lies mainly in the relatively cheap currency, according to the Korea Bank.

Other experts, according to the Korea Times, explain that foreign investors buy shares to make up for their excessive dumping last year.