Foreign investors' net purchases of Japanese stocks last month topped 1 trillion yen for the first time in 22 months.

International investors bought 1.09 trillion yen more than they sold on the Tokyo, Osaka and Nagoya stock exchanges, more than four times the previous month's 235.78 billion yen, according to a weekly industry report.

While Japanese banks and corporate investors continued unwinding their cross-shareholdings, nonresident investors were net buyers for the fifth consecutive month.

Their net purchases for the first four months of the year totaled 2.4 trillion yen, more than offsetting their net selling for all of 2000 -- 2.36 trillion yen.

The recent upturn in New York share prices, coupled with the inauguration of the reform-oriented Cabinet of Prime Minister Junichiro Koizumi, has apparently enticed foreign investors to build their Japanese portfolios, brokerage officials noted.

In the last week of the month alone, foreign investors logged 189.65 billion yen in net purchases, compared with 340.23 billion yen the previous week.

Margin buying up

The balance of shares bought on credit rose in volume for the ninth consecutive week last week, mirroring a leap in investor sentiment.

The outstanding balance of long margin positions on the Tokyo, Osaka and Nagoya stock exchanges stood at 2.81 billion shares at the end of the holiday-shortened two-day week, up 19.46 million shares over a week earlier.

In value, the balance of margin buying stood at 1.6 trillion yen, down 20.48 billion yen. This was the first fall in two weeks, offering evidence of a shift in buying interest to lower-priced shares.