Foreign investors sold a record net amount of Korean stocks in February—totaling 19.56 trillion won—driven largely by concerns over an overheated AI sector and rising geopolitical uncertainty, according to official statistics cited by the Korea Times. The wave of selling was concentrated in AI-related sectors such as semiconductors and was led by investors from the United States and the United Kingdom.

What happened in February?
The official data show that foreign investors registered a monthly net outflow of 19.56 trillion won, the largest on record, as global sentiment turned cautious. Reports attribute the sell-off to mounting fear of an AI industry bubble and the knock-on effects of broader geopolitical instability, which together heightened risk aversion toward Korean equities.

Which investors sold the most?
The selling was not evenly distributed across markets. According to the provided figures, investors from the United States accounted for about 8.7 trillion won in net sales, while those from the United Kingdom contributed roughly 4.7 trillion won. These concentrated flows from major Western markets amplified the scale of the outflow and underscored how international perceptions of sectoral risk influenced capital movements.

Which sectors were hit hardest?
Available reports indicate that AI-related names, particularly in semiconductors, experienced steep declines as part of the broader foreign exit. Market commentary linked the sectoral weakness to fears that AI valuations had outpaced fundamentals, prompting repositioning by global portfolio managers who had previously chased technology-linked returns.

Why this matters for the Korean market
A record monthly sell-off by foreign investors can exacerbate volatility and weigh on market sentiment beyond the immediate price impact. Given the prominence of semiconductors and AI-linked firms in Korea’s equity market, concentrated foreign selling raises questions about near-term capital flow stability and the pace at which international investors reassess exposure to sector-driven risks.

Sources and reporting
The figures and market interpretation are drawn from official statistics released by the financial supervisory authority and were reported by major economic outlets, including the Korea Times (published 2026-03-27). Those accounts emphasize that the combination of AI sector overheating concerns and heightened geopolitical uncertainty—cited in the reporting—was central to the foreign investor exodus in February.