Japan trust fund outflow slows in Nov after selloff
TOKYO, Dec 2 (Reuters) - The net outflow from Japanese trust funds fell 90 percent in November from the month before, while domestic equity funds drew steady inflows, industry data showed on Tuesday.
Global stock markets regained some poise last month after a huge slide in October during which the Nikkei 225 .N225 lost 24 percent and logged the worst monthly performance in its 58-year history.
The net outflow from Japanese investment trust funds totalled 39.1 billion yen last month, down sharply from 408.2 billion yen in October, Nomura Research Institute data showed.
Domestic stock trust funds drew in money for the second month in a row, with a net inflow of 65.4 billion yen though that was down from an inflow of 80.2 billion yen in October.
"Share prices are under pressure due to pessimism over the outlook for the economy, but looking at the actual condition of domestic companies, many are oversold," said Masaru Hamasaki, a senior strategist at Toyota Asset Management.
"Retail investors who have more flexibility in making fresh investments could be shifting into stocks, especially into index-linked products, as they are easier to understand."
Japanese retail investors, who hold a massive 1,500 trillion yen in personal savings largely in deposits, are key buyers of publicly offered trust funds, with small and mid-sized institutional investors also seen as big buyers.
Nikko IDX F225 62000233JP.LP, a fund linked to the Nikkei 225 index, was the biggest gainer in November in terms of percentage of outstanding asset value, according to fund research firm Lipper, a Thomson Reuters company.
The benchmark Nikkei .N225 tumbled 6.4 percent to 7,863.69 at one point on Tuesday, but it was off a 26-year trough below 7,000 hit in late October.
Japanese retail and institutional investors continued to shy away from overseas bonds and equity funds due to the strength of the yen, analysts said.
Foreign stock investment trust funds saw an outflow of 14.3 billion yen in November, sharply down from 131.9 billion a month earlier.
The net fund outflow from foreign bonds withered to 2.5 billion yen in November from 220.3 billion yen the month before.
"The yen's strength is depressing the inflow. There is also a general feeling among retail investors of doubt about the dollar outlook," Hamasaki said.
On Tuesday, the dollar dropped to a five-week low of 92.87 yen JPY= on trading platform EBS, not far from a 13-year low of 90.87 yen reached in late October.
The outstanding value of investment trust funds slid nearly 4 percent in November due to falls in share prices and a rise in the yen, but the drop were smaller than the previous month. Continued...
