Foreign investors hold record $24.3T in US equities

Summary

In July, non-US investors reached a historic high in their ownership of US stocks, holding $24.32 trillion in equities, marking the third-largest amount ever recorded. This represents a year-to-date increase of $2.22 trillion, or 10%, and a staggering $12.3 trillion surge, or 103%, since the 2022 bear market. Consequently, foreign allocation to US equities reached a record 60% of their US financial assets, surpassing the marker set during the 2000 Dot-Com Bubble. This trend is backed by a recent analysis indicating that foreign investors are increasingly favoring US equities over Treasury securities, showing strong demand for large, liquid US companies.

Analysis

US equities: U.S. equities are ownership securities issued by American companies, including common and preferred shares and equity-fund holdings. They are central to the report because foreign investors’ exposure to this asset class has expanded sharply and now represents a record share of their U.S. financial assets. foreign investors: Foreign investors are individuals, institutions, and governments based outside the United States that allocate capital to U.S. financial assets. They are relevant to this news because their holdings of U.S. equities reached a historically elevated level in July, reflecting strong overseas demand for U.S. stocks. Foreign demand: Recent Treasury-related reporting indicates that overseas purchases of U.S. equities and equity funds reached a record pace over the year through July, even as foreign appetite for U.S. debt weakened. Asset allocation: Recent analysis shows foreign investors have increasingly favored U.S. equities over Treasury securities within their U.S. asset portfolios. Market concentration: Recent market-flow reporting indicates that international capital remains concentrated in large, liquid U.S. companies, which continue to attract the strongest overseas demand.

Categories

macropolitics

Related sources

View Original Tweet