Foreigners turn net sellers of Japanese stocks after three weeks of buying

Jan 20 (Reuters) - Foreigners were net sellers of Japanese shares for the week ended Jan. 14 as concerns over a spike in Omicron-driven COVID-19 infections in the country and increased expectations that the U.S. Federal Reserve will lift rates as early as March, curbed risk appetite.

Stocks worth 344.73 billion yen ($3.01 billion) were offloaded last week by foreigners, the most since Dec. 3, data from Japanese exchanges showed.

Cross-border investors sold 272 billion yen worth of derivatives and 72.23 billion yen in cash equity markets.

However, outsiders purchased Japanese bonds worth 1.05 trillion yen last week, marking a third straight week of net buying, finance ministry data showed.

Last week, a surge in COVID-19 infections in the major metropolitan areas of Tokyo and Osaka spurred a sell-off in Japanese retailers and service providers including Aeon 8267.T and cinema operator Toho 9602.T .

Hawkish remarks from Fed officials, which solidified expectations of a policy rate hike as early as March, also weighed on investor sentiment.

The Nikkei share average .N225 dropped 1.24% last week in a second straight week of decline, while the Topix index .TOPX lost 0.9%.

Japanese investors purchased 1.05 trillion yen worth of overseas bonds last week, however, they sold cross-border equities worth 531 billion yen, marking a second straight week of net selling.

($1 = 114.4600 yen)

Foreign flows into Japanese stocks Link
Japanese investments in stocks abroad Link

Reporting by Gaurav Dogra and Patturaja Murugaboopathy in
Bengaluru; Editing by Shounak Dasgupta

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