SEOUL, March 27 (Yonhap) -- Foreign investors have been scooping up technology shares listed on South Korea's secondary market this year due to their improved earnings outlook amid rising demand for mobile devices, data showed Wednesday.
Overseas investors increased their stakes in 30 firms listed on the tech-heavy KOSDAQ market by more than 3 percentage points between the start of the year and Monday, with technology firms taking up 63 percent of the total, the Korea Exchange (KRX) data showed.
Foreigners' share holdings in Patron Co., a mobile parts maker, jumped 11.88 percentage points to 32.15 percent over the cited period, and their stake of Duksan Himetal Co. gained 8.99 percentage points to 17.63 percent.
Danal Co., a payment system provider, saw its foreigners' share holdings jump 7.63 percentage points to 8.88 percent, and their stake in communication equipment maker Suprema Inc. also soared nearly three-fold to 11.22 percent.
Market watchers said the buying rally on the secondary market was buoyed by expectations that technology firms will fare better down the road on brighter earnings outlooks for top players such as Samsung Electronics Co.
South Korean tech giant Samsung Electronics unveiled the Galaxy S4 phone, the latest in its flagship Galaxy S line-up, earlier in March in a move to solidify its dominance in the global smartphone market.
Meanwhile, the low returns on the main bourse sparked by the weak yen and the move by Vanguard Group Inc. to change its benchmark index also induced foreigners to switch to a new investment destination, market watchers added.
U.S. fund manager Vanguard Group earlier decided to switch the index provider for its funds to the Financial Times Stock Exchange (FTSE) from Morgan Stanley Capital International (MSCI), effective in January.
Unlike MSCI, the FTSE does not include the South Korean main bourse in their benchmark portfolio, which sparked concerns among local analysts that there would be a huge outflow of foreign funds from the local stock market.
Meanwhile, foreign investors scooped up a net 6.8 trillion won (US$6.17 billion) worth of shares on the KOSDAQ market over the cited period, compared to a net selling of 2.5 trillion won on the main bourse, the data added.
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