South Korea's KOSPI closed on Feb. 27 at 6,244.13. Foreign investors posted net sales of 7.1153 trillion won, the largest ever for a single day. Investor deposits also rose 10 trillion won the same day to a record high.

According to the Korea Exchange, foreign investors recorded net sales of 24.1843 trillion won on the KOSPI over the past month as of Thursday. They sold a net 7.1153 trillion won on Thursday alone. Individuals recorded net purchases of 6.2824 trillion won and institutions recorded net purchases of 533.5 billion won.

The foreign selling has been concentrated in mega-cap stocks centred on semiconductors.

As of Feb. 26, foreign investors' net sales on the KOSPI this month totalled 9.9912 trillion won in Samsung Electronics and 5.0312 trillion won in SK Hynix. The combined total for the two stocks alone exceeded 15 trillion won.

The analysis is that the selling has a strong technical character, with foreigners locking in profits and reducing portfolio weightings after blue-chip stocks surged sharply in a short period.

Valuation 부담 is also cited as a factor weighing on foreign flows. As KOSPI gains accumulated rapidly, there was a growing perception that further upside depended on whether earnings would follow. In that process, foreigners were seen trimming stocks with heavier price 부담 first.

The fact that the market is in a phase of rising volatility is also strengthening foreigners' rationale for "adjusting weightings."

During the session, the KOSPI slid to as low as 6,153.87 and rose to as high as 6,347.41, swinging by nearly 200 points in a day. Turnover on the main board reached a record 53.9 trillion won.

U.S.-driven volatility was also seen as a catalyst for heavy foreign selling.

On Feb. 26 U.S. local time, Nvidia fell 5.46 percent to close at $184.89 despite strong results, and the Philadelphia Semiconductor Index also fell more than 3 percent amid weakness in major AI and semiconductor-related stocks.

In U.S. markets the same day, the Nasdaq index fell 1.2 percent to 22,878.38 and the S&P 500 fell 0.5 percent to 6,908.89, showing a trend of weakening investor sentiment across tech stocks.

In the market, many see the foreign selling less as a "departure from the Korean market" and more as a process of taking profits mainly in blue-chip stocks after a sharp rise and adjusting risk exposure.

Still, there are views that if foreign flows do not return in the short term, the buying capacity of individuals and institutions could drive the index trend. That has led to calls for investors to check earnings and valuations alongside the exchange rate and volatility indicators.

Shinhan Investment Corp researcher Jin Hyuk Kang (강진혁) said, "Investor deposits hit 111.3 trillion won in early February and then showed a slight outflow during the Lunar New Year holiday, but they are rebounding again." He said that amid fading risk-asset preference and MSCI rebalancing, foreign net sales hit a daily record, yet deposits rose 10 trillion won in a single day to set a new record of 119.5 trillion won.