According to a report from Statistics Canada this morning, attractive yields on some corporate bonds helped boost foreign investment in Canadian securities in August to $11.09 billion from $5.51 billion in July.
StatsCan said the steady influx of foreign investment, which surpassed analysts' expectations of $5 billion, and the moderate Canadian investment abroad in the month extended the 20-month trend.
Non-residents invested the second largest amount so far in 2010 in Canadian bonds in August, adding $10.80 billion to their portfolios. Breaking down the total shows that they spent $5.30 billion on private corporate bonds, which was comprised primarily of new issues from resources and transportation companies.
Foreigners returned to the Canadian stock market in August after net divestments in July, buying $995 million as stock prices rose 1.7 percent. They reduced their holdings of money market instruments by $705 million as many of these securities matured in the month.
Canadians for their part invested $3.38 billion in foreign securities in August after divesting C$2.98 billion the previous month. They bought $2.48 billion in foreign stocks, the largest amount since March and made up mostly of U.S equities.
