Global Investment in U.S. Stocks a Record in ’99

The whole world is buying. Or so it seems.

Foreign investors spent a record amount on U.S. stocks last year to tap into economic growth, low inflation, a strong dollar and gains in technology shares, the Securities Industry Assn. said Tuesday.

Overseas investors bought about $108 billion of U.S. equities in 1999, double the 1998 level and trouncing the previous record of $70 billion in 1997, the trade group estimated.

But demand for U.S. Treasury bonds slumped last year to a 25-year low, as foreign investors looked for higher returns from American equities and corporate bonds.

“People planning for retirement in Europe wanted to get involved in the rally in technology stocks,” said David Strongin, vice president and director of international finance at the SIA. “And there was no better country to do that in than the U.S. last year.”

Meanwhile, although many foreign stock markets were even hotter than the U.S. market last year, American investors were net sellers of foreign stocks, SIA said. Through November Americans sold a net $17.8 billion of foreign shares.

The strong dollar may have kept Americans home: As the dollar gains foreign stocks are worth less when translated from their native currencies into dollars.