Foreign Investors Boost Japanese Stocks Amid Chip Sector Rally
▼ Summary
– Foreign investors bought a net 611.7 billion yen in Japanese stocks for the second straight week, marking their 13th net purchase in 14 weeks.
– The Nikkei hit an 11.5-month high but ended the week with a 0.85% loss due to caution over US trade deal deadlines.
– AI-linked tech stocks surged, with SoftBank Group rising 6.15% and Advantest hitting weekly record levels.
– US President Trump announced 25% tariffs on Japanese goods starting August 1, adding to market uncertainty.
– Japanese investors bought a net 1.66 trillion yen in foreign bonds but sold a net 512.7 billion yen in foreign stocks.
Foreign investors continue showing strong confidence in Japanese equities, particularly in the technology sector, despite broader market uncertainties. Recent data reveals sustained buying activity focused on AI-related stocks, highlighting growing global interest in Japan’s semiconductor and advanced technology industries.
For the second consecutive week ending July 5, overseas investors purchased a net 611.7 billion yen ($4.4 billion) worth of Japanese shares. This marks the 13th week of net buying within a 14-week period, according to Japan’s Ministry of Finance. The sustained inflow comes even as the benchmark Nikkei 225 index declined 0.85% during the same timeframe after reaching an 11-month peak.
Technology stocks outperformed the broader market, fueled by surging global demand for artificial intelligence components. SoftBank Group, a major AI investor, saw its shares jump 6.15%, while semiconductor equipment manufacturer Advantest reached new weekly highs. This sector-specific strength demonstrates how specialized tech firms are driving market momentum despite macroeconomic headwinds.
Market sentiment faced pressure from trade policy developments, with the U.S. announcing new 25% tariffs on certain Japanese goods effective August 1. Meanwhile, Japan’s debt markets showed mixed activity – foreign investors withdrew 164.6 billion yen from long-term bonds after heavy purchases the prior week, while pouring 447.3 billion yen into short-term bills.
On the outbound investment front, Japanese institutions made their largest weekly purchase of foreign long-term bonds in seven weeks, acquiring 1.66 trillion yen worth. However, they simultaneously sold 512.7 billion yen in overseas equities, the most significant weekly divestment in a month. This contrasting behavior suggests domestic investors are rebalancing portfolios amid shifting global yield environments.
(Source: Aletihad)