Nov 15 (Reuters) - Foreign investors sold out of

emerging market stocks in October by the most since the COVID

market selloff in early 2020, but inflows to EM bonds and debt

more than offset the outflow, data from a banking trade group

showed on Friday.

The October monthly net total inflow of $1.9 billion

compares with a $56.4 billion inflow in September and an $8.1

billion outflow in October 2023.

Stock portfolios saw a $25.5 billion outflow, the largest

since March 2020, while bonds attracted $27.4 billion.

Chinese equities alone shed $9 billion while China bonds

pulled in $1.4 billion, despite a renewed stimulus push from the

government in late September. A fresh November stimulus

announcement also fell short of expectations.

"Despite targeted easing measures by the Chinese government,

investor confidence remains low," IIF economist Jonathan Fortun

said in a statement.

"These dynamics have driven substantial market shifts, where

growth concerns and regulatory uncertainty continue to deter

foreign investment in China."

As markets were setting up for the U.S. presidential

election in early November, late October saw a move toward

trades that would benefit if Donald Trump returned to the White

House - driving up the dollar and U.S. rates.

"Concerns over the dollar's strength relative to EM

currencies have amplified risk aversion in equity markets,"

Fortun said.

"This shift aligns with the expectation that yield

differentials and rate trajectories may increasingly favor EM

debt over equities as risk aversion rises globally."

Regionally, last month Asia saw a net $6.8 billion outflow,

while Emerging Europe received $5.2 billion and Latam $3.6

billion. Flows to Africa were marginally negative.

Year-to-date, foreigners have poured about $249 billion net

into their emerging market portfolios. Some $220 billion has

gone to debt, $169 billion of which went outside of China.