FOREIGNERS REDISCOVER U.S. STOCKS Better late than never? During most of the U.S. stock market's epic bull run in recent years, foreigners have remained on the sidelines. Indeed, from 1987 through early last year, U.S. net purchases of foreign equities far exceeded foreign purchases of U.S. stocks. The pattern reversed dramatically in the second quarter of 1997, however, as foreign investors staged a veritable invasion of Wall Street. By the end of the third quarter, Federal Reserve data reveal, foreigners had channeled $52 billion into U.S. equities--four times U.S. purchases of foreign equities and only a tad less than foreigners had shelled out over the previous five years. Why the sudden appetite for U.S. stocks? Market analyst Melissa R. Brown of Prudential Securities thinks that the rising U.S. dollar may have been the catalyst. With inflation subdued, the U.S. economy roaring ahead, and interest rates low, many European and Asian investors finally decided the surging U.S. stock market was the best place to be. In any case, the cash infusion from overseas undoubtedly helped boost stock prices last year--and may well do so again in 1998 if Asian turmoil fails to subside. BY GENE KORETZ RELATED ITEMS CHART: Overseas Investors Bet on Wall Street

Updated Jan. 22, 1998 by bwwebmaster
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