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5 days ago
- Business
- Yahoo
Foreigners pour billions into Taiwan, South Korea stocks on AI, growth optimism
By Sameer Manekar and Gaurav Dogra (Reuters) -Foreign investors flocked to Asian stocks for the third straight month in July, with inflows into Taiwan hitting a near two-decade high and Thailand snapping its nine-month losing streak, buoyed by growth and AI prospects as trade worries fluctuate. Foreign inflows into most Asian equity markets have stabilised over the past three months as countries clinched better trade arrangements with the United States, calming tariff-related volatility and uncertainty in financial markets. Overseas investors showed strong interest in Taiwan and South Korea for the third straight month in July, pouring $7.78 billion in Taiwan, the highest since the 2008 global financial crisis, and $4.52 billion in South Korea, the most since February last year, LSEG data showed. The MSCI gauge of equities in Asia excluding Japan rose 2% last month, its fifth consecutive month in green, while benchmarks in Taipei and Seoul advanced roughly 6% each. Taiwan and South Korea were the top destinations in the region for foreign capital, securing a cumulative $25.7 billion over the past three months as the two dominant Asian tech exporters benefit from a global surge in AI-related investments. South Korea's shareholder-friendly reforms, political stability, and robust corporate fundamentals lured investors in 2025 after a dreary performance last year, though recent concerns over reforms to tax policy are posing new challenges. Foreign investors also net bought $499 million worth of Thai equities in July, the first month of inflows since September last year, as they scooped up stocks at relatively cheap valuations after a prolonged period of heavy selling. Even so, Thailand's uncertain political climate, challenging macroeconomic conditions, and an unnecessarily strong currency that undermines export competitiveness continue to impede any buildup of positions on these equities. Thailand's benchmark SET index surged 14% in July — its best month since November 2020 — but still not enough to erase steep losses suffered earlier in the year. The index remains 10% in the red, ranking among the region's worst performers. "We are cautious and underweight on Thailand as it remains in a fairly precarious position: high household debt, limited government spending, an uncertain political environment, and external negative events such as the conflict with Cambodia," said Kenneth Tang, senior portfolio manager at Nikko Asset Management. "If Thailand can settle these issues, it will clear up the path for its recovery." Indian stocks experienced sharp outflows of over $2 billion in July, the highest since February this year and snapping a three-month streak of net purchases. Indonesia and the Philippines also logged net outflows of $570 million and $29 million, respectively, last month, while Vietnam attracted $326 million as investors bet on the country's strong growth prospects after it secured a comfortable tariff rate with the United States.
Yahoo
5 days ago
- Business
- Yahoo
Foreigners pour billions into Taiwan, South Korea stocks on AI, growth optimism
By Sameer Manekar and Gaurav Dogra (Reuters) -Foreign investors flocked to Asian stocks for the third straight month in July, with inflows into Taiwan hitting a near two-decade high and Thailand snapping its nine-month losing streak, buoyed by growth and AI prospects as trade worries fluctuate. Foreign inflows into most Asian equity markets have stabilised over the past three months as countries clinched better trade arrangements with the United States, calming tariff-related volatility and uncertainty in financial markets. Overseas investors showed strong interest in Taiwan and South Korea for the third straight month in July, pouring $7.78 billion in Taiwan, the highest since the 2008 global financial crisis, and $4.52 billion in South Korea, the most since February last year, LSEG data showed. The MSCI gauge of equities in Asia excluding Japan rose 2% last month, its fifth consecutive month in green, while benchmarks in Taipei and Seoul advanced roughly 6% each. Taiwan and South Korea were the top destinations in the region for foreign capital, securing a cumulative $25.7 billion over the past three months as the two dominant Asian tech exporters benefit from a global surge in AI-related investments. South Korea's shareholder-friendly reforms, political stability, and robust corporate fundamentals lured investors in 2025 after a dreary performance last year, though recent concerns over reforms to tax policy are posing new challenges. Foreign investors also net bought $499 million worth of Thai equities in July, the first month of inflows since September last year, as they scooped up stocks at relatively cheap valuations after a prolonged period of heavy selling. Even so, Thailand's uncertain political climate, challenging macroeconomic conditions, and an unnecessarily strong currency that undermines export competitiveness continue to impede any buildup of positions on these equities. Thailand's benchmark SET index surged 14% in July — its best month since November 2020 — but still not enough to erase steep losses suffered earlier in the year. The index remains 10% in the red, ranking among the region's worst performers. "We are cautious and underweight on Thailand as it remains in a fairly precarious position: high household debt, limited government spending, an uncertain political environment, and external negative events such as the conflict with Cambodia," said Kenneth Tang, senior portfolio manager at Nikko Asset Management. "If Thailand can settle these issues, it will clear up the path for its recovery." Indian stocks experienced sharp outflows of over $2 billion in July, the highest since February this year and snapping a three-month streak of net purchases. Indonesia and the Philippines also logged net outflows of $570 million and $29 million, respectively, last month, while Vietnam attracted $326 million as investors bet on the country's strong growth prospects after it secured a comfortable tariff rate with the United States.
Yahoo
03-06-2025
- Business
- Yahoo
Japanese equity funds log sharpest weekly outflows since 2007
By Gaurav Dogra and Rae Wee (Reuters) -Japanese equity funds logged their largest weekly outflows in nearly 18 years in the week to May 28, as investors either booked profits following a rally fueled by the then-easing U.S.-China trade tensions or turned cautious on earnings potential. According to LSEG Lipper data, Japanese equity funds recorded net outflows of $7.49 billion, marking the largest weekly withdrawal since July 4, 2007. Daisuke Motori, director of manager research at Morningstar Japan, said the outflows from Japanese equity funds in May reflected a familiar pattern, with investors buying during April's dip and selling into the May rebound. Some of the flows could also be due to rebalancing by Japan's massive life insurance and pension firms as they sell rising stocks and buy bonds to maintain asset ratios, analysts said. Another headwind has been the yen, which has appreciated 10% against the U.S. dollar so far this year, potentially eroding export profitability. LSEG data shows analysts have downgraded forward 12-month earnings estimates for Japanese firms by 1.8% over the past 30 days. "Corporate governance is improving, but we think this is unlikely to be a near-term catalyst," said Herald van der Linde, head of equity strategy at Asia Pacific. He noted that while reforms were underway, their impact on profits would take time - return on equity (ROE) in Japan still lagged other major markets. Domestic investors drove almost the entirety of outflows, Lipper data showed, with $7.55 billion pulled from local funds. In contrast, foreign funds recorded $59 million in net inflows. The Daiwa iFreeETF TOPIX, Nikko Listed Index Fund TOPIX, and Nomura NF TOPIX ETF recorded the largest outflows during the week, with redemptions of $2 billion, $1.92 billion, and $1.61 billion, respectively. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
03-06-2025
- Business
- Yahoo
Japanese equity funds log sharpest weekly outflows since 2007
By Gaurav Dogra and Rae Wee (Reuters) -Japanese equity funds logged their largest weekly outflows in nearly 18 years in the week to May 28, as investors either booked profits following a rally fueled by the then-easing U.S.-China trade tensions or turned cautious on earnings potential. According to LSEG Lipper data, Japanese equity funds recorded net outflows of $7.49 billion, marking the largest weekly withdrawal since July 4, 2007. Daisuke Motori, director of manager research at Morningstar Japan, said the outflows from Japanese equity funds in May reflected a familiar pattern, with investors buying during April's dip and selling into the May rebound. Some of the flows could also be due to rebalancing by Japan's massive life insurance and pension firms as they sell rising stocks and buy bonds to maintain asset ratios, analysts said. Another headwind has been the yen, which has appreciated 10% against the U.S. dollar so far this year, potentially eroding export profitability. LSEG data shows analysts have downgraded forward 12-month earnings estimates for Japanese firms by 1.8% over the past 30 days. "Corporate governance is improving, but we think this is unlikely to be a near-term catalyst," said Herald van der Linde, head of equity strategy at Asia Pacific. He noted that while reforms were underway, their impact on profits would take time - return on equity (ROE) in Japan still lagged other major markets. Domestic investors drove almost the entirety of outflows, Lipper data showed, with $7.55 billion pulled from local funds. In contrast, foreign funds recorded $59 million in net inflows. The Daiwa iFreeETF TOPIX, Nikko Listed Index Fund TOPIX, and Nomura NF TOPIX ETF recorded the largest outflows during the week, with redemptions of $2 billion, $1.92 billion, and $1.61 billion, respectively.
Reuters
02-05-2025
- Business
- Reuters
Japanese investors raise foreign stock holdings for sixth week on easing trade tensions
May 2 (Reuters) - Japanese investors raised their foreign stock holdings for a sixth straight week as their sustained appetite for overseas equities was further bolstered by signs that the U.S. and China were willing to ease trade tensions. The local investors also viewed last week's stronger yen as an opportunity to enhance their overseas asset positions. The yen reached a seven-month high of 139.86 per dollar before partially reversing its gains. The Reuters Tariff Watch newsletter is your daily guide to the latest global trade and tariff news. Sign up here. Japanese investors allocated a net 133.8 billion yen ($920.85 million) to foreign equities last week, marking their sixth consecutive week of net purchases, according to data from Japan's Ministry of Finance. They also acquired a net 435.2 billion yen in long-term foreign bonds. The MSCI World Index (.MIWD00000PUS), opens new tab climbed to a five-week high of 840.47 on Thursday, supported by progress in U.S.-China tariff negotiations and strong earnings reports from major tech firms. Meanwhile, Japanese equities attracted a net 278.3 billion yen in foreign inflows, the smallest weekly cross-border investment in the past four weeks. Foreign interest in Japanese bonds also cooled, with inflows into long-term Japanese bonds falling to 60 billion yen last week, down sharply from approximately 1 trillion yen in net purchases the previous week. ($1 = 145.3000 yen) Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Janane Venkatraman Our Standards: The Thomson Reuters Trust Principles., opens new tab
