Last week we reported that in October, a record month in which Japanese stocks saw just one losing day in the entire month, foreigners bought a record amount of Japanese equities. It wasn’t just Japan, however, where the international community was busy buying. According to the just released TIC data, foreigner accounts, both official and private, were just as busy buying US stocks. In fact, of the $61 billion in net long-term securities purchased by foreigners in September, almost half – or $26 billion – was equities. This was the highest monthly total of US stocks purchased by foreigners since July 2016, and the second highest going all the way back to July 2009.
Purchases of other securities were also notable: foreign investors’ net holdings of U.S. coupon debt securities increased $34.557 billion following an increase of $45.937 billion the month before. The value of foreign investors Treasury coupon holdings increased $12.735 billion in September after increasing $17.477 billion in August. Foreign holdings of corporate debt climbed $12.937 billion, following a $19.224 billion the month prior; and there was a net increase in the value of GSE/MBS holdings of $8.885 billion in September after the $9.236 billion increase in August.
Finally, a summary of Treasury holdings by the largest foreign accounts reveals that in October virtually all the key names sold, including China, Japan, Russia and Saudi Arabia, offset by the "special" venues of Belgium, which is traditionally used by anonymous offshore accounts (recently China), and Caymans, which is a proxy for Hedge Funds, as well as many "other" nations.
China: decrease of $19.7Bn to 1.180Tn.
Japan: decrease of $5.7Bn to $1.096Tn.
Russia: decrease of $1.5Bn to $103.9Tn
Saudi Arabia: decrease of $1.2Bn to $136.7Bn
Belgium: increase of $7.9Bn to $104.8Tn
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