(Reuters) — Overseas investors were net sellers of Asian shares in 2024, owing mostly to a surge in selling in the fourth quarter on worries that US President-elect Donald Trump’s trade policies may harm Asian economies.
They sold a net $15.8 billion worth of stocks in Taiwan, South Korea, India, Thailand, Indonesia, Vietnam, and the Philippines last year, after investing $26.6 billion in 2023.
They invested $14.67 billion in the first three quarters, boosted by expectations of Fed easing and regional development. However, they then moved to aggressive selling, aided by a stronger dollar and higher US rates.
Taiwan topped the region in outflows last year, with $12.4 billion, followed by Thailand and Vietnam, which net sold $4.11 billion and $3.63 billion, respectively.
The macroeconomic environment for Asian stocks remains tough this year, according to Goldman Sachs analyst Timothy Moe.
Moe said that early-year market challenges include mixed economic data, increasing 10-year rates in the United States, and a stronger currency, as well as potential additional US tariffs on Asia-Pacific countries, prolonged economic policy uncertainty, and geopolitical concerns.
Yearly foreign investment flows into Asian stocks in millions of dollars
Trump, who takes office on January 20, has promised to impose a 10% tariff on all global imports to the United States and a 60% tax on Chinese goods, measures that are anticipated to harm other Asian exporters owing to their interwoven supply chains with China.
Although Trump’s threats may eventually be talked down, “banking on less aggressive tariffs at this stage could seem premature,” said Yeap Jun Rong, market analyst at IG, adding that “inflows may still remain limited for now, until more policy clarity emerges.”
“We expect foreign investors would be picky on the markets and sectors, as we anticipate more variance across the Asian equities market based on their domestic policy agenda vs. sensitivity to US
