Foreign investment is returning to Southeast Asia! The "hot cake" of Asian investment emerges in 2026.

Global capital is returning to Southeast Asian stock markets this month, making the region a key sector in the global financial landscape of 2026. Driven by the advantages of undervalued assets and the need for diversified portfolio allocations, Southeast Asia's emerging markets have attracted a net inflow of foreign capital of $337 million in December, potentially reaching a new high since September 2024. In the previous 11 months, foreign capital had been selling stocks in the Southeast Asia region for 10 months, but the current trend is led by the inflow of capital into the markets of Indonesia and Thailand. However, looking at the entire year, foreign capital outflows from Southeast Asian stock markets in 2025 still amounted to about $15 billion. In 2025, the MSCI ASEAN Index underperformed broader Asia-Pacific indices by about 13 percentage points, marking the largest difference in the past five years. One of the core reasons for this is the lack of asset classes related to the booming artificial intelligence (AI) industry in the region. In addition to the attractiveness of undervalued assets, many fund managers are eager to find alternative investments for their high-tech stock positions amid concerns about the AI bubble expansion, making the ASEAN market a preferred destination. Christopher Wong, portfolio strategist at Fidelity International, said, "Investors generally have a need for diversified allocations and are hoping to reduce their reliance on the U.S. market and crowde...