Korea Weekly Kickstart KOSPI rebounded by 11 amid sharp decline in volatility index and strong foreign inflows

Portfolio Strategy Research 14 August 2026 | 11:33PM SGT

KOSPI rebounded by 11% amid sharp decline in volatility index and strong foreign inflows

n KOSPI rebounded by 11% amid sharp decline in volatility outflows have been dominant in 2026 YTD. Timothy Moe, CFA | index (Exhibit 49) and strong foreign inflows. The Tech, Concentrated net selling of Korean semiconductor Goldman Sachs (Singapore) Pte

Auto and Machinery sectors outperformed this week, names has driven foreign ownership in the KOSPI John Kwon | while Utilities, Leisure and F&B sectors underperformed semiconductor sector to -2 s.d. below the long-term Goldman Sachs (Singapore) Pte the most (Exhibit 12). mean. In July, based on preliminary EPFR data (~20% of n Foreign investors turned to buy the KOSPI market, driven total AUM reported), Asian funds are still UW with by inflows for KOSPI Tech (Exhibit 39). Korea while Asian funds raised exposure in Korea the most (vs. benchmark). Among EM funds, EM funds are n KOSPI 12m-forward EPS was revised up by +1.0%. The also UW with Korea but EM funds have raised exposure Auto sector saw the strongest upward earnings revisions, the most in Korea, and trimmed exposure in China and while the Utilities sector was revised down the most this India. On the other hand, retail investors inflows have week (Exhibit 26). weakened recently amid foreign inflows. Amid the n The KRW weakened 0.3% vs. USD this week. It also recent market volatility, retail investors turnover ratio weakened 0.4% vs. EUR but strengthened 0.5% vs. JPY. has fallen below foreign investors turnover ratio. Retail n The latest Korea Equity Risk Barometer (GSSRKERB investors flows into leverage ETFs and conventional Index) is at 0.1, rebounding into a risk-neutral territory. ETFs have reduced while increased into foreign equity benchmarked ETFs and Inverse ETFs. The latest margin call to brokerage receivables ratio (5dma) has stabilized Charts of the Week: Foreign Positioning and Retail further, which is in line with historical norms and Investors Activities Pulse Check; MSCI Global suggests deleveraging stress has been absorbed. Investable Market Indexes Index Review and Flow Implications (August 2026) n MSCI Index August 2026 Review : With the MSCI n Foreign Positioning and Retail Investors Activities August rebalancing, Korea is expected to see net Pulse Check : This week, foreign investors turned to buy outflows by US$1bn. By sector, Tech Hardware & Semis KOSPI led by major semi names although foreign (+US$204mn) could see the largest passive inflows,

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Goldman Sachs Korea Weekly Kickstart

Charts of the week: Foreign Positioning and Retail Investors Activities Pulse Check 4

Charts of the week: MSCI Global Investable Market Indexes Index Review and Flow Implications (August 2026) 6

Valuation discount relative to Global and Asia regional peers 15

Currency, rates and commodities 18

Korea ERB, Credit and Market Technicals 19