Japanese stocks saw robust foreign inflows ahead of Takaichi's election victory

Foreigners bought ‌Japanese stocks of a net 543.2 billion yen ($3.55 billion) in the week to February 7, registering the largest weekly net purchase since January 17, data ‌from Japan's Ministry of Finance showed on Friday.

Japanese stocks witnessed foreign inflows for ​a seventh straight week in ​anticipation of Prime Minister Sanae ‌Takaichi's decisive ​election victory on Sunday, paving the way for stimulus measures and promised tax cuts. Foreigners bought ‌Japanese stocks of a net 543.2 billion yen ($3.55 billion) in the week to February 7, registering the largest weekly net purchase since January 17, data ‌from Japan's Ministry of Finance showed on Friday. After a historic election ‌win on Sunday, Takaichi said that she is committed to a "responsible, proactive fiscal policy."

The Nikkei hit successive record highs this week, keeping it on track for the best week ⁠since ​end-October, with gains at ⁠5.48% so far. The 10-year Japanese government bond yields, have, meanwhile, descended roughly 1.6 basis ⁠points this week as remarks from Finance Minister Sastsuki Katayama eased fiscal concerns. Foreigners divested ​Japanese long-term bonds by 464.1 billion yen last week after investing a ⁠combined 4.74 trillion yen over a five-week streak of net purchases.

They, however, bought 1.25 ⁠trillion ​yen worth of Japanese short-term bills, the most for a week since January 10. Japanese weekly net investments in foreign stocks, meanwhile, dipped to ⁠162.7 billion in the most recent week from about 454.6 billion yen, a ⁠week ago.

In ⁠the bond market, Japanese investors sold foreign long-term bonds totaling roughly 365.7 billion yen, following two consecutive weeks of net ‌purchases. ($1 = ‌153.1200 yen)