As the S&P 500 hit a record high in March, Canadian investors stampeded into U.S. stocks, according to new data from Statistics Canada.
Canadian investors plowed $21.2 billion into foreign securities in March, led by the addition of $11.8 billion in U.S. equities, StatsCan reported.
Investors primarily focused on large-cap tech stocks and index-tracking investment funds, the report noted.
The strong flows into U.S. stocks in March followed $12.3 billion worth of U.S. equity buying in February.
Institutional investors, primarily pension funds and mutual funds, also bought $3.8 billion worth of non-U.S. foreign equities in March, the national statistical agency said.
Canadian investors also added $5.6 billion worth of foreign bonds in March.
The $21.2 billion that flowed into foreign securities in March followed $13.1 billion in February and $3.1 billion in January, StatsCan noted.
In fact, after the onset of the Covid-19 pandemic touched off a record divestment in March 2020, Canadian investors have acquired a total of $122.8 billion of foreign securities since May 2020, it reported.
At the same time, foreign investors bought $3.2 billion worth of Canadian securities in March, also primarily equities.
Investors bought $10.6 billion worth of Canadian stocks during the month, up from $9.5 billion in February. However, they also divested $7.3 billion of Canadian debt.
“After focusing on shares of Canadian banks in February, foreign acquisitions mainly targeted shares of trade and transportation, as well as non-bank financial industries in March,” StatsCan said.
Overall, the portfolio flows resulted in a net outflow of $18.0 billion from the Canadian economy in the month, pushing the first quarter total to $24.7 billion, which was the largest amount since the fourth quarter of 2007, it reported.