In today’s briefing:
- Korea’s ₩195tn Ownership Shift: Foreigners Exited, Retail Absorbed — Buybacks Are No Floor Yet
- Japan Capital Market Is Eating Itself: Buybacks Outrun IPOs 100 to 1, the Buyer Was Ordered to Buy
- Overview #78 – Not Out of the Woods
Korea’s ₩195tn Ownership Shift: Foreigners Exited, Retail Absorbed — Buybacks Are No Floor Yet
- Foreigners sold a record ₩148trn of Korean equities in 1H26, with Samsung and SK hynix accounting for ~87% of the exit.
- Retail absorbed the selling at the top, but September turnover has halved and leveraged demand is now fading as the buyback became an exit door.
- Position for the structural bid: favour value-up banks and holdcos, be selective on Samsung/SK hynix, and avoid leveraged AI and IPO exposure.
Japan Capital Market Is Eating Itself: Buybacks Outrun IPOs 100 to 1, the Buyer Was Ordered to Buy
- Corporate Japan absorbs ¥20trn of equity in 2026 against ¥10trn the market must clear; on a share-count basis about 2% of market capitalisation is being retired.
- Seventeen IPOs raised ¥144bn in 1H26 against ¥16.2trn of buybacks and 128 delistings; insurers’ zero-holding targets run to FY2029–30, but disposal pace is slowing.
- Post-BoJ hike: overweight cash-funded buyback names and take-private candidates; underweight Growth market, JGB duration and yen cash; neutral yen, hold Japan equities unhedged.
Overview #78 – Not Out of the Woods
- A review of recent events/data impacting our investment themes and outlook
- The Boj, the Fed, and the ECB all tightened rates this week – with different outcomes
- Tightening liquidity globally, but still no signs of a major top
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