• Foreign ownership in South Korean shares has dropped significantly, attributed to Donald Trump's re-election.
• The Korea Exchange data shows foreign holdings in the KOSPI have fallen to 32.3 percent, a yearly low.
• Trump's policies and the weakening of the Korean won have led to heavy selling by offshore investors.
• The sell-off has impacted the Korean stock market and major companies like Samsung Electronics, causing a dip in the KOSPI.

The global financial market has been stirred by the recent plummet in foreign ownership of South Korean shares. This significant drop is attributed to the re-election of Donald Trump as the President of the United States. The data, released on Sunday, has sparked a flurry of discussions among market analysts and investors alike.

The Korea Exchange, the main bourse in South Korea, has compiled data that paints a stark picture. Foreign holdings in the KOSPI, the benchmark index of the Korea Exchange, have fallen to 32.3 percent. This translates to a staggering 637.48 trillion won ($456 billion) of the total market capitalisation, which stands at 1,973.51 trillion won as of Friday.

The year began on a different note, with foreign investors holding 32.7 percent of KOSPI-listed stocks. However, the ratio has been on a steady decline since then. It fell to 34 percent in August and further to 33 percent in September, despite a brief rebound to 36 percent in July.

Trump's Re-election and the Korean Market

The re-election of Donald Trump as the U.S. President has been a significant factor in this scenario. His policies are perceived as potentially detrimental to several industries, including chipmakers, automakers, and EV battery manufacturers. This has led to offshore investors adopting a heavy selling mode, leading to a further dip in foreign holdings.

The weakening of the Korean won against the U.S. dollar has further exacerbated the situation. The local currency is currently hovering around a two-year low against the greenback, prompting foreign investors to offload local shares heavily. In this month alone, foreign investors have sold a net 1.87 trillion won worth of stocks on the main bourse.

The sell-off by foreign investors has had a profound impact on the Korean stock market. The KOSPI has dipped by 5.4 percent this month alone, a clear indication of the market's reaction to the foreign sell-offs. Market heavyweights have borne the brunt of this sell-off, with their stocks taking a significant hit.

Impact on Market Heavyweights

Samsung Electronics, the world's largest memory chip maker, has been one of the most affected. Foreign investors have sold a whopping 2.74 trillion won worth of Samsung Electronics this month. This has resulted in their holdings in the company falling to 51.72 percent, the lowest in 19 months. The last time their ratio was this low was on April 25 last year, when it stood at 51.68 percent.

The tech giant's shares plunged to an over four-year low of 49,900 won on Thursday. This was primarily due to concerns over a possible scrapping of chip incentives by U.S. President-elect Trump. However, in a bid to bolster its share price, Samsung Electronics announced a 10-trillion won share buyback scheme on Friday.

Other companies have also felt the heat of the foreign sell-off. Foreign investors sold 338 billion won worth of Samsung SDI this month, followed by Hyundai Motor with 246 billion won and Hana Financial with 73 billion won.