For the first year since 1989, foreign investors sold Japanese stocks and missed a rally.
Overseas investors, who account for more than two-thirds of trading in Tokyo, cut holdings in 2015 even as the Topix index climbed 8.9 percent in dollars and 21 percent in euros. It had been 2½ decades since foreigners last offloaded shares amid annual gains, data compiled by Bloomberg show. As traders dumped $1.9 billion, Japan's own pension funds, asset managers, central bank and companies took their place.
For Goldman Sachs Group Inc., the home team sending shares higher can only be good, with domestic inflows showing equities can rise without substantial weakness in the yen. Overseas investors will return in 2016 on a favorable outlook for earnings and improved corporate governance, according to Sompo Japan Nipponkoa Asset Management Co.