Foreigners own more on Tokyo exchange

TOKYO - A surge in foreign investment in Japan has boosted overseas holdings to at least 30 percent in more than 100 companies listed on the Tokyo Stock Exchange, the Nihon Keizai newspaper reported Sunday.

The share owned by foreigners, as of the end of September, was up from 20 percent in March, the newspaper said, citing its own survey. The shift follows an influx of foreign buying that has spurred a six-monthlong rally on the Tokyo Stock Exchange and has lifted its benchmark Nikkei 225 Index about 27 percent since May.

Domestic companies that are more than 30 percent owned by overseas investments totaled 103, up from 85 at the end of March, the newspaper said. Its survey encompassed Tokyo listed companies with business years ending on March 31.

The number of companies half owned by foreigners was 11, including electronics maker Canon Inc. Other companies that have seen foreign ownership hit all-time highs include industrial robot maker Fanuc Ltd, electronics company Ricoh Co and trading house Sumitomo Corp, all more than 30 percent held overseas.

Real estate firms are also popular with foreign investors as Japanese land prices start rising for the first time in 15 years.

Foreign money, nearly two-thirds of it from North America, has piled into Japan in recent months.

Overseas investors ploughed a net $US40.6 billion ($NZ59.8 billion) into Japanese shares from July to September alone -- more than half of last year's total -- and now account for 60 percent of daily trading, according to Tokyo Stock Exchange data.

The surge is supported by new optimism about the world's second-largest economy.

Japanese stocks had lost about 80 percent of their value between late 1989 and 2003, as the country struggled with a burst real estate bubble, sluggish corporate earnings, rising unemployment and mountains of bad debt at the nation's banks.

Now, Japan's steady economic recovery makes the stock market seem like a bargain-priced safe haven, while concerns about inflation and interest rate hikes in the United States undercut enthusiasm for Wall Street, which has mostly flatlined this year.