Foreigners Bought C$4.62 Billion of Canadian Securities in March, Lowest Level This Year

By Robb M. Stewart

OTTAWA--Foreign investment in Canadian securities slowed to is lowest level in March since the start of the year as investors offloaded holdings of Canadian shares for a second month running.

Canadian investment in foreign securities also was down for the month, resulting in international transactions generating a net inflow into the Canadian economy of roughly 719 million Canadian dollars (US$525 million) in March after an outflow the month before of more than C$19.4 billion, Statistics Canada said Friday.

Nonresident investors purchased a net C$4.62 billion during March. After heavy investment to start the year, foreign acquisitions of Canadian securities over the first quarter totaled C$57.77 billion, a sharp reversal compared with the C$5.99 billion in Canadian securities sold in the same period last year.

Foreigners added $8.46 billion of Canadian debt securities to their portfolios in the latest month, largely provincial government bonds denominated in euros. Activity in federal government and corporate debt securities was marginal, the data agency said.

Non-resident investors reduced their holdings of Canadian shares by C$3.84 billion, following a $9.07 billion divestment in February. March's selling was tied to retirements of Canadian shares resulting from cross-border merger-and-acquisition activity, Statistics Canada said.

On an industry basis, the selling in March was led by shares of the banking and the energy and mining industries, which was moderated by an investment in shares of manufacturing stocks.

Meanwhile, Canadian investors bought C$3.9 billion of foreign securities, which the agency said was well below the monthly average investment of C$16.7 billion over the previous four months.

Canadians made a record investment in U.S. corporate bonds for a second straight month, with purchases totaling roughly C$10.4 billion, but they reduced holdings of U.S. government bonds and foreign money market instruments. Nearly half of the U.S. corporate bonds that were picked up were denominated in Canadian dollars, the agency noted.

Canadian investors bought C$1.86 billion of foreign equity securities in March, down sharply from a C$32.74 billion investment in February. Investors added about C$2.7 billion of U.S. shares in March, bringing the first-quarter investment to an unprecedented C$40.3 billion, largely targeting large-capitalization technology shares.

The monthly international securities report covers a portfolio of transactions in equity and investment fund shares, bonds and money market instruments for both Canadian and foreign issuers. The activity excludes transactions in equity and debt instruments between affiliated enterprises.

Write to Robb M. Stewart at [e-mail]

(END) Dow Jones Newswires

05-15-26 0924ET