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Foreign investors have sharply increased selling in South Korea’s main stock market this month, while selectively buying growth stocks on the Kosdaq, particularly in the biotech and healthcare sectors, as geopolitical risks tied to the Middle East reshape investment flows.

According to the Korea Exchange on Sunday, foreign investors sold a net 30.33 trillion won ($20.23 billion) worth of shares on the Kospi from March 3 to 27, already exceeding last month’s total net selling of 19.6 trillion won. The figure is on track to mark the largest monthly outflow on record.


Selling pressure intensified in the latter half of the month, with foreigners extending a seven-session selling streak from March 19 to 27. In just two days on March 26 and 27, net sales reached 6.81 trillion won.

The shift has been driven largely by geopolitical tensions linked to the conflict between the United States and Iran, which have amplified macroeconomic risks. Analysts say the Kospi, heavily weighted toward large manufacturing exporters such as Samsung Electronics and SK hynix, is more vulnerable to external shocks including rising oil prices and supply chain disruptions.

Concerns are also mounting that prolonged instability in the Middle East could disrupt helium supply, a key input in semiconductor manufacturing, and even affect air cargo capacity if aviation fuel shortages worsen.

In contrast, the Kosdaq has shown relative resilience. Although foreign investors sold about 530 billion won worth of shares over March 26–27, they remain net buyers for the month with cumulative purchases of 187 billion won.

Biotech and healthcare stocks have led the inflows. Among the top 10 Kosdaq stocks purchased by foreign investors this month were PharmaResearch, Rznomics, SamChunDang Pharm, Curiox BioSystems, Rokit Healthcare and Mezzion. Additional names drawing attention include Hugel, Oscotec and Alteogen.

Investor sentiment has been supported by expectations for clinical progress and potential licensing deals, which are seen as less exposed to geopolitical shocks compared with traditional manufacturing sectors.

Analysts note that even within the Kosdaq, large-cap biotech firms have outperformed, attracting both foreign and institutional inflows. Events such as clinical trial updates and licensing agreements have served as key catalysts.

Robot-related stocks have also stood out as investors bet on future growth. SPG and Koh Young Technology ranked first and fifth, respectively, in net foreign purchases on the Kosdaq during the period, with 89 billion won and 79 billion won in inflows.

The selective buying trend is expected to gain further momentum alongside the government’s planned Kosdaq reforms. Analysts say the proposed split of the market into separate tiers could become a key determinant of valuation and capital flows, potentially strengthening long-term investment in high-quality venture and technology firms.

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