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Taiwan, South Korea drive Asian equity outflows in July as AI worries bite
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Taiwan, South Korea drive Asian equity outflows in July as AI worries bite
Aug 10, 2026 11:24 PM

Aug 11 (Reuters) - Foreign investors sold Asian equities on

a net basis for a ninth consecutive month in July, with heavy

selling in Taiwan and South Korea as concerns over AI spending

and chip demand weighed on the region's technology-heavy

markets.

Regional tech exporters came under pressure last month after

Alphabet and Tesla reported negative cash

flows, raising worries over the durability of growth and

mounting cash burn.

"AI heavyweights in South Korea and Taiwan faced massive

selloffs as investors started to question their chip-demand

forecasts and debt-repayment ability," BNP Paribas analysts said

in a July note, adding that China's Moonshot announcement about

its low-cost AI models "aggravated negative market sentiment."

Foreign investors sold a net $25.48 billion worth of stocks

across South Korea, Taiwan, India, Indonesia, Thailand, Vietnam

and the Philippines last month, according to LSEG data.

Taiwan accounted for $22.95 billion of the outflows,

following June's roughly $8 billion in outflows, and South Korea

another $6.26 billion, marking a third consecutive month of

outflows.

Vietnamese stocks also recorded marginal foreign outflows of

$12 million last month.

Meanwhile, equities in India, Thailand, Indonesia and the

Philippines logged foreign inflows of $2.12 billion, $1.46

billion, $88 million and $69 million, respectively, partly

offsetting the withdrawals.

"The unusually high swings in AI-related sectors are making

global investors diversify, and on that measure we think India

looks better placed," said Herald van der Linde, head of equity

strategy for Asia Pacific at HSBC, in a note last week.

"We recently upgraded India to neutral within Asia," van der

Linde wrote.

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