Foreigners increase buying in Japan stocks

Foreigners were net buyers of Japanese stocks for a second straight week ended Oct. 18, as optimism around the Brexit deal and rising hopes of Washington and Beijing signing the initial phase of a trade deal next month improved risk sentiment. Overseas investors bought a net 1.22 trillion yen ($11.23 billion) of Japanese stocks, including cash equities and futures, highest since mid-September 2018, data from the Japanese stock exchanges showed. Cross-border investors bought a net 662.74 billion yen in derivative markets and 556.38 billion yen in cash markets, data showed.

Last week, the Nikkei index gained 3.2% while the Topix index surged 1.7%, both marking their biggest weekly gain in five weeks. The rally in local shares came as the UK and the European Union struck a long-awaited Brexit deal last week, however, British Prime Minister Boris Johnson faces a deadlock with the parliament, over it's timing. Meanwhile, progress in the initial phase of a US-China trade deal also supported local shares.

US President Donald Trump outlined a partial trade deal to end it's 15-month long trade war with China on Oct. 11, that may get signed during a summit of Asia-Pacific Economic Cooperation countries on Nov. 16-17. This week, the Nikkei gained for a fourth successive week and hit over a year high of 22,819.92.