Foreign retail investors are flooding the US stock markets with unprecedented capital, according to analysts at the capital markets newsletter The Kobeissi Letter.
Net purchases of U.S. stocks by the foreign private sector rose $35.2 billion month-on-month in May to $121 billion, the second-largest inflows on record. reports The Kobeissi letter, citing Reuters data.
“Everyone wants US stocks.”
This is the second consecutive monthly increase. So far, foreign private investors have bought about $270 billion worth of U.S. stocks. Record monthly inflows will be around $130 billion in November 2024.
In contrast, foreign investors recorded large outflows from South Korean and Taiwanese stocks during the same period.
“Foreign investors dumped -$31 billion and -$28 billion on South Korean stocks in June and May, respectively, the two largest monthly outflows on record. Moreover, foreign investors also sold -$18 billion on Taiwanese stocks in June, the second-largest sale on record. Global capital continues to favor U.S. stocks versus the rest of the world.”
Such continued buying from abroad provides a powerful tailwind for U.S. stock prices and liquidity.
The inflows indicate strong global confidence in US companies, despite fluctuations in the domestic market.
Analysts view the data as a key indicator of international interest in U.S. assets.
Global capital continues to favor US equities over other markets.
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