(BFM Bourse) – For the first time in eight years, the share of French CAC 40 companies held by non-resident investors rose again in 2021. Last year, these shareholders owned 40.5% of the capital of the 35 CAC 40 companies headquartered in France, according to a study by the Banque de France.
Non-residents have regained their appetite for the stars of the French coast. After eight years of decline, these foreign investors have increased the share they hold in the capital of the 35 French CAC 40 companies. At the end of 2021, they owned 40.5% of the total market capitalization of these companies, i.e. 866 billion euros. euros out of a total of 2.137 billion euros, reveals a recent study by the Banque de France.
This figure reflects an increase of one percentage point compared to 2020. Since 2013, this is the first year marked by an increase in the rate of detention of non-residents.
Non-residents favor French equities
Source: Banque de France (balance of payments) and Euronext
In detail, 12 of the 35 French companies in the CAC 40 are majority-owned by non-residents. Among the 23 others, 7 are less than 30% owned by non-residents and 16 between 30% and 50%.
Why 35 CAC 40 companies? The authors specify that they have excluded from the scope of their study, the CAC 40 companies having their head office established abroad (Airbus, ArcelorMittal, Eurofins Scientific, Stellantis and STMicroelectronics).
Large caps are not the only ones popular with non-resident investors. Of all French shares listed on Euronext, the rate of ownership by non-residents increased by 1.1 percentage point to 37.6%. However, this is one of the lowest rates among major European countries, the study notes. Foreign investors hold almost 46% of the shares in Italy or 65% of the rating in the United Kingdom. A proportion that even rises to almost 87% in the Netherlands.
Commodities and consumer services top purchases
For the first time since 2016, non-residents bought more than sold French CAC 40 shares. In 2021, net purchase flows of shares in these companies by non-residents reached 13.3 billion euros. euros, after four consecutive years marked by sales exceeding purchases. For their part, residents sold more than bought, with net sales of 6.9 billion euros of French CAC 40 stocks.
Source: Banque de France (balance of payments)
Net flows of share purchases by non-residents were mainly directed towards investments in CAC 40 companies related to oil and gas activities as well as consumer services.
In 2021, the consumer and community services sector recorded the largest increase in the relative share of non-resident ownership, with an increase of 4.1% compared to 2020. Non-residents acquired for 1. 8 billion euros of securities in this sector.
This sector is closely followed by that of “oil, gas, materials and industries” with an increase of 3.5%. International investors thus acquired 12.7 billion euros in this sector during the year. On the other hand, the relative share held by foreign investors in the “health and consumer goods” sector fell slightly by 0.8% or 1.4 billion euros in value.
Investments by non-residents relate mainly to portfolio investments, up to 90.8%. Direct investment represents 9.2% of the total, down just over a percentage point from last year when it reached its highest level since 2008 at 10.3%.
Sabrina Sadgui – ©2022 BFM Bourse