Foreign investors remained net sellers of Japanese stocks for the fourth straight week last week.
Nonresident investors sold 54.58 billion yen more than they bought on the Tokyo, Osaka and Nagoya stock exchanges on top of net sales of 67.87 billion yen the previous week, according to a weekly industry report.
With much of the recent uptrend in Japanese stock prices running out of steam, foreign investors found few reasons to take major positions in the choppy market, brokerage officials noted.
Foreign investors adjusted their oversold Japanese positions in late February and early last month, but the upturn in their purchases soon tapered off.
The trigger for the strong surge in foreign buying in February and March was the government’s antideflation measures and tightened controls on short selling, said Toshihiko Matsuno, an analyst at Sakura Friend Securities Co.
The Feb. 27 government package, primarily aimed at keeping stock prices afloat artificially, prompted foreign institutional investors to cover their short positions by buying back stocks, he said.
Recently, however, foreigners have been busy unloading Japanese high-technology issues once again, Matsuno said.
They appear likely to remain on the sidelines through much of this month and beyond, he said, pointing to a lack of strong morale boosters and uncertainty about the political climate in Japan.
Among domestic market players, trust banks — the managers of public pension funds — remained net buyers for the second week in a row, chalking up 70.64 billion yen in net purchases on top of 86.09 billion yen the previous week.
There was talk that those banks’ net purchases roughly matched the entire flow of money from pension funds.
Trust banks were net buyers through much of the last two months, with their net purchases for February alone at 275.7 billion yen.
Long-term credit banks, city banks and regional banks as a whole, on the other hand, sold 10.44 billion yen more than they bought on top of 42.52 billion yen in net sales the previous week.
With the industrial web of cross-shareholdings continuing to unravel even after the start of the new fiscal year, those banks remained net sellers for the 27th week in a row.
Individual investors were net sellers for the first time in four weeks, with their net sales at 12.12 billion yen, a turnaround from 150.78 billion yen in net buying the previous week, offering fresh evidence of a shift in investor sentiment for the worse.
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