Canadian investors dumped U.S. stocks in July, and foreign investors continued snapping up Canadian government bonds, driving a $51.3-billion inflow from securities transactions for the month, according to new data from Statistics Canada.
The national statistical agency reported that Canadian investors sold off a record $31 billion worth of U.S. stocks in July, primarily large cap tech stocks.
Investors also sold $5.1 billion of U.S. government bonds in the month — the sixth straight month of domestic investors reducing their holdings, pushing the total divestment for the year to $37.3 billion.
The selloff in U.S. government bonds was largely offset by investors buying $3.3 billion worth of other foreign bonds, and $1.8 billion of U.S. corporate bonds, Statistics Canada noted.
At the same time, foreign investors added $20.7 billion of Canadian securities, driven by $22.7 billion rolling into federal government bonds.
Through the first seven months of the year, investors have accumulated $104 billion in federal government bonds, up from $13.8 billion in the same period last year — pushing the share of outstanding federal government debt held by foreign investors up to 46.5% from 40.2% at the start of the year, Statistics Canada noted.
Offshore investors also added $7.2 billion worth of Canadian stocks in July — mainly in the energy and mining sectors.
The buying was partly offset by investors selling $11.9 billion worth of Canadian money market instruments in the month.