Foreign investors are increasingly favoring Taiwanese stocks over South Korean equities, driven by more stable earnings outlooks following a sharp AI-driven selloff in July.

Data compiled by Bloomberg shows that overseas buyers turned net purchasers of Taiwan stocks last week, ending a six-week stretch of net selling. So far in August, they have acquired $1.7 billion worth of Taiwanese shares, while simultaneously offloading $6.2 billion in Korean stocks.

The shift underscores growing confidence in Taiwan's semiconductor and technology sectors, which remain central to global AI supply chains. In contrast, South Korea's tech-heavy market, including major exporters like Samsung Electronics, has faced renewed pressure amid valuation concerns and export demand uncertainty.

Analysts note that while both markets remain vulnerable to global macroeconomic swings and geopolitical tensions, Taiwan's more diversified investor base and steadier corporate earnings trajectory are providing a competitive edge. Market watchers will be closely monitoring upcoming earnings reports and central bank policies in both regions for further directional cues.

By Elaine Lai and Sangmi Cha, August 11, 2026.