AI Boom Drives Demand Prospects, Foreign Capital Continuously Increases Holdings in Japanese Stocks for Eight Weeks

The data released by Japan's Ministry of Finance today shows that as of May 23, the net purchase amount of foreign capital in the Japanese stock market reached 10.8 trillion yen, equivalent to about 6.77 billion US dollars. This figure increased by nearly 14% from the previous week's 9.484 trillion yen, indicating that overseas investors have continued to increase their holdings in Japanese stocks for the eighth consecutive week. The main reasons for the continued inflow of funds are the retreat of international oil prices and the strong demand prospects for artificial intelligence-related stocks.

The global surge in artificial intelligence investment directly propelled the rise of Japan's technology sector. Nvidia predicted last week that its flagship AI chip would face strong demand, significantly enhancing the market's investment willingness in the entire technology industry. Driven by this, SoftBank Group recorded a significant share price increase of 17.62% last week, and Socionext, a chip design company, also saw a rise of 12.26%.

Looking at the overall trend this year, the scale of external capital inflow into the Japanese stock market has increased significantly compared to the same period last year. To date in 2026, foreign capital has accumulated nearly 11.7 trillion yen into the Japanese stock market. In contrast, at the same time last year, the net purchase amount of foreign capital was only about 742.1 billion yen, and the comparison of data indicates that the configuration of overseas funds in Japanese stock assets has clearly strengthened.

In terms of Japan's bond market, overseas investors showed a clear differentiation in term preferences last week. With the tide of sales easing and higher yields attracting, long-term Japanese bonds saw a net purchase of 13.5 trillion yen last week, reversing the outflow of 10.3 trillion yen the previous week. Meanwhile, foreign capital significantly outflowed to short-term financial instruments by 2.22 trillion yen, setting a new record for the largest weekly net outflow since March 28.

Unlike the aggressive purchasing attitude of foreign capital, domestic Japanese investors are retracting their foreign assets. Japanese domestic investors withdrew a net amount of 358.7 billion yen from overseas stock markets last week, marking the third consecutive weekly net sell-off in the past four weeks. However, in the overseas long-term bond market, Japanese investors made a small net purchase of 1.03 billion yuan last week, extending the continuous purchase cycle to the fourth week.