By Gaurav Dogra and Patturaja Murugaboopathy
June 9 (Reuters) - Foreign investors are buying Asian shares
after dumping them over the past three months, as lifting of
coronavirus lockdowns has boosted optimism regional economies
are set for recovery.
Overseas investors bought $5.45 billion worth of regional
equities in the first six trading days of this month, data from
stock exchanges in India, Indonesia, the Philippines, South
Korea, Taiwan, Thailand and Vietnam showed.
They sold $46.45 billion between March and May, which hit
regional currencies and raised fears that some countries
dependent on external financing to fund their current acccount
deficits would come under further pressure.
"The picture has certainly improved into June as May
economic indicators suggested a bottoming of the COVID-19 drag,
instilling a sense of hope and powering Asia markets that tend
to benefit with such recovery momentum," said Jingyi Pan, a
Singapore-based market strategist at financial services firm IG.
Pan said Asian markets were able to catch-up to their U.S.
counterparts as Washington's reaction to Beijing's new national
security law for Hong Kong was not as bad as feared.
The MSCI's broadest index of Asia-Pacific shares
.MIAP00000PUS has gained about 6.5% this month, tracking the
rally in global shares .MIWD00000PUS which climbed about 6.7%,
as of Monday's close.
Indian equities led the region with inflows of $2.76 billion
worth of foreign money so far this month, while Taiwan received
$1.88 billion.
An increase in U.S.- nonfarm payrolls last month added to
optimism this week as governments around the world started to
lift tough lockdown measures imposed to contain the coronavirus
which has infected 7.1 million people and killed 406,225.
The increase in foreign buying was also due to a slump in
global interest rates as major central banks unleash stimulus to
revive their economies, analysts said.
"With massive expansion of major central bank balance sheets
and activity starting to recover as restrictions in the region
ease, we should start to see inflows return," said Khoon Goh,
head of Asia research at ANZ.
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Foreign flows in Asian equities - June 2020 https://tmsnrt.rs/3f2vwbA
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