Foreigners dump Asia stocks at record pace as AI winners get crowded

Foreign investors sold Asian equities at the fastest pace in at least 16 years in the first half of 2026, trimming exposure to the region’s biggest AI-driven winners. In total, they withdrew a net $137.36 billion from shares across South Korea, Taiwan, India, Indonesia, Thailand, Vietnam and the Philippines, according to LSEG data dating to 2010. South Korea and Taiwan accounted for most of the outflows, with $70.8 billion and $29.6 billion respectively. The selloff followed sharp gains in the KOSPI (nearly doubled) and Taiwan’s index (up 62%), powered by chip leaders including TSMC, Samsung and SK Hynix. Analysts said the movement reflected currency hedging and benchmark rebalancing, not a broad risk-off stance, as funds sought cheaper markets elsewhere in Southeast Asia. In June alone, foreign investors sold $27.08 billion, including $12.63 billion from South Korea and $8 billion from Taiwan.