Foreign investors’ buying of local stocks surged this year on the back of eased fear on the eurozone debt crisis that fueled a huge inflow of European money into the emerging markets like Korea, data showed Wednesday.

Foreign investors have scooped up local stocks worth a net 8.8 trillion won ($7.82 billion) this year as of Monday, according to the data by the Financial Supervisory Service, the country’s financial regulator.

Offshore investors have been on an extensive buying spree since late last year, with their purchases of local stocks reaching a monthly high of a net 6.2 trillion won in January.

Of the foreign stock purchase, European money accounted for the most with a net 3 trillion won, followed by the United States at a net 2.3 trillion won. The Cayman Islands-based investors snapped up a net 770 billion won and investors from Singapore bought a net 580 billion won, according to the data.

Aggressive foreign buying came as waning fear over the debt-laden eurozone prodded overseas investors to expand their investment portfolio, scurrying to make risky bets in the emerging markets, analysts said.

With the return of a foreign investors-led rally, where the question lies is whether such trend will continue. Foreign investors’ buying streak is likely to go on for some time, as the local stock market still has room for further gains, according to analysts.

“Foreigners could think that the KOSPI isn’t high enough yet in consideration of the currency exchange rate. Since the won has stayed strong, they are likely to snap up more equities, looking out for foreign exchange gains,” said Kim Young-il from Daishin Securities Co.

The KOSPI shot up 9.89 percent since the beginning of this year to close at 2,002.64 on Tuesday. 

(Yonhap News)