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Foreigners net sellers of Japanese stocks for fifth straight week

Oct 8 (Reuters) - Foreign investors remained net sellers of Japanese equities last week on rising uncertainty about the U.S. presidential elections and concerns over the resurgence of coronavirus casesin several parts of the world.

Data from Japanese exchanges showed foreigners were net sellers of stocks worth 753.73 billion yen for the week ended Oct. 2, the biggest since mid-March.

They sold 696.58 billion yen worth of derivatives, and 57.15 billion yen in cash equities markets.

Japanese stocks, which tend to benefit when global investors are willing to take higher risks, dropped last week after a combative debate between President Donald Trump and Democrat Joe Biden increased concerns about an indecisive election outcome.

Also, surging coronavirus cases in Europe, which prompted new restrictions in several parts further curbed risk appetite.

Overall, flows into Asian stocks, including Japan, have not really recovered since the heavy selling in March, analysts said. However, some were confident that inflows would improve in coming months.

“Assuming we see some positive headline on the vaccine front and/or uncertainty from U.S. elections ebbs within the next couple of months, we should expect the outlook for foreign flows (into Asia) to get incrementally better from here,” said Chetan Seth, equity strategist at Nomura.

Japan’s Topix index fell 1.55% last week, while its Nikkei share average shed 0.75%, marking a third straight week of decline.

Both indexes have gained over 2% this week as hopes for a partial deal on U.S. coronavirus stimulus helped restore investor confidence.

On the other hand, Japanese investors sold overseas equities worth a net 57.3 billion yen last week, marking a fourth successive week of net selling, finance ministry data showed.

Reporting by Gaurav Dogra and Patturaja Murugaboopathy; Editing by Simon Cameron-Moore

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