News > Asset Management

Massive net buying by foreigners in APAC

By ValueWalk
Asset Management

In emerging Asia ex. China and Malaysia, yesterday’s [September 16] net foreign buying of $0.8 billion turned out to be the single biggest day for net foreign buying since April 2014, notes Credit Suisse Group AG (ADR) (NYSE:CS). Sakthi Siva and King Nang Chik said in their “APAC Equity Strategy” report that they continue to be Overweight the cheapest four markets: MSCI China, Korea, Taiwan and Singapore.
Yesterday’s relief buying in APAC after substantial selling by foreigners
Siva and Chik term it “a pleasant surprise” when net foreign buying of $789 million was logged in Emerging Asia ex. China and Malaysia on Sept. 16, after the net foreign selling over the past four months. The analysts point out that yesterday logged net foreign buying of $470 million in India, followed by $184 million in Korea and $158 million in Taiwan:

However, Siva and Chik note the $789 million of net foreign buying comes after net foreign selling of $21 billion out of Emerging Asia ex. China and Malaysia. As can be deduced from the following table, net foreign selling over the past three to four months out of Emerging Asia ex. China and Japan is $36.3 billion:

The CS analysts point out that on a rolling 12-month basis, net foreign buying has dropped to 0% of market cap on a rolling 12-month basis for Emerging Asia ex. China and Malaysia:

Foreign investor capitulation in a few APAC markets
Highlighting the markets which have witnessed foreign investor capitulation, Siva and Chik point out that Korea (-0.1%), the Philippines (-0.4%), Indonesia (-0.7%), Thailand (-1%) and Malaysia (-1.5%) witnessed foreign investors turning net sellers over the past year:

However, in a few markets, including India, foreigners are still net buyers over the past 12 months:

Subscribe to our Newsletter

Be one of the first to experience the future of financial services