Japanese Investors To Invest In Foreign Stocks As Banking Fears Subside

Last week, Japanese investors poured money into overseas stocks, boosted by easing fears about the banking sector and expectations that the Federal Reserve is reaching the end of its rate-hiking cycle.

They spent 390.3 billion yen ($2.97 billion) on foreign shares, the most in eleven weeks, according to statistics from Japan's Ministry of Finance released on Thursday.

The MSCI world stock index rose 3.5% last week, the highest since mid-November 2022, as market concerns about the banking sector subsided following a U.S. regulator-backed sale of failing lender Silicon Valley Bank's assets.

Meanwhile, following three weeks of net purchasing, Japanese investors sold a net 486.1 billion yen worth of foreign bonds last week.

Foreign investors, on the other hand, withdrew a net 414.96 billion yen from Japanese shares in their third straight week of net selling last week, according to data from Japanese exchanges.

They sold 422.02 billion yen in futures but bought 7.06 billion yen in cash stocks.

Meanwhile, foreigners sold a net 1.75 trillion yen worth of Japanese bonds last week, the second week in a row.

They sold 2.7 trillion yen in short-term bonds but purchased 944.1 billion yen in long-term bonds.