International investors buying Canadian securities

International investors resumed their net purchases of Canadian securities in July, taking on $6.67 billion after having reduced their holdings by $7.76 billion in June, Statistics Canada said on Monday.

The biggest component was a $6.1-billion purchase of Canadian bonds, after large retirements in June. The acquisition was partly offset by a $4.12-billion divestment of money market paper.

Investment in equities amounted to $4.69 billion. "New equity issues led the inflows over the month, with the bulk related to cross-border merger and acquisition activity," the government agency said.

It involved a Canadian company's issuing of new stock to shareholders of a foreign company that it bought. Statscan did not name the firms involved.

Canadian authorities have said foreign investors view Canada as a safe haven. So far this year international investors have made $41.23 billion in net purchases, a substantial amount though down from $54.31 billion seen in the first seven months of 2011.

Canadian investment in foreign securities rose to $4.56 billion from $4.12 billion, with net purchases of foreign stocks hitting a four-month high of $2.28 billion.