Japanese Stock Surge: Foreign Investors Return Amid AI Rally

Foreign investors resumed purchasing Japanese stocks, buying a net 479.4 billion yen, following AI stock rallies and a U.S.-Iran ceasefire deal. This is the first net purchase since May, as markets respond positively. Chipmakers Kioxia and Advantest saw significant gains, boosting investor confidence in Japanese equities.

Foreign investors returned to the Japanese stock market, purchasing a net 479.4 billion yen ($2.96 billion) worth of shares, data from the Ministry of Finance revealed. This marks their first net purchase since May 23, spurred by AI stock rallies and geopolitical developments such as the U.S.-Iran ceasefire.

The Nikkei soared 7.9% last week, driven by strong performances from AI-related stocks such as Kioxia and Advantest, which recorded gains of 33.74% and 16.16%, respectively. Fujikura, an AI data-center materials maker, also surged by 21.26%, contributing to the buoyant market sentiment.

Despite the bullish stock market activity, foreign investors continued to withdraw from Japanese bonds, selling 593.4 billion yen last week. Meanwhile, Japanese investors shifted strategies, buying 426.8 billion yen of overseas stocks and turning net buyers of foreign bonds for the third straight week.