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Foreigners Dumped US Stocks In September, Central Banks Sold TSYs For 5th Straight Month

Foreigners Dumped US Stocks In September, Central Banks Sold TSYs For 5th Straight Month

As a reminder, US Treasury yields spiked in September and stocks tumbled – the latest period for which we have TIC data.

 

The breakdown was as follows:

  • Long-term Treasuries: +$1.4BN, the smallest since May, and down from $30.7BN in August

  • Agencies +$22.7BN,  most since June, and up from $17.7BN in August

  • Corporate bonds +1.1BN, down sharply from $14.7BN in August

  • Corporate Stocks were sold for $(10.9)BN, a reversal from the $8.7BN purchased in August

Japan remains the largest foreign holder of US Treasuries ($1.3 tn) but in September (the latest TIC data), it dumped over $20 billion (the biggest monthly liquidation since September 2019)

Source: Bloomberg

China, which holds $1.05 tn in US Treasuries, made a small buy of $0.6 bn in September – hovering at its lowest holdings since Dec 2016…

Source: Bloomberg

Sales of US stocks by foreigners: $12.7BN in sales from Private entities, offset by $1.7BN in purchases by Official (central bank, reserve manager) accounts

And foreign central banks have been dumping US Treasuries for 5 straight months…

Luckily The Fed will buy the bonds and Retail options traders will BTFD in stocks…

Tyler Durden
Tue, 11/16/2021 – 16:20

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