Kospi Sell-off

The South Korean Financial Supervisory Service said: “Most of the selloff was confirmed to have been made through Deutsche Bank’s South Korean securities unit, which sold about Won1,600bn worth of shares.

The 20-minute drop “flash crash” in US equities in May briefly erased nearly $900bn. A subsequent report by the Securities and Exchange Commission and Commodity Futures Trading Commission pinpointed a single trade by a fund manager.

About Won17,000bn of foreign funds have flowed into South Korea’s stock market, boosting the Kospi index almost 14 per cent this year, but analysts suspect that foreign investors’ desire for profit-taking is getting stronger, as they see growing foreign exchange gains with the won hovering at a six-month high against the dollar.

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