Overseas investors dumped the most Japanese stocks on record last week while buying up cash equities amid growing uncertainty over whether a rally in shares will continue.

Foreigners sold a record ¥2.24 trillion ($14.2 billion) of Japanese equity futures in the week ended Oct. 2, according to data from Japan Exchange Group Inc. In the same week, they bought a net ¥956 billion of cash stocks. Net selling of cash equities and futures combined was around ¥1.28 trillion.

“I would read the divergence as greater caution about the next leg of the rally, rather than an outright lack of appetite for Japanese equities,” said Ipek Ozkardeskaya, senior analyst at Swissquote.

“From here, earnings will need to justify the rally, particularly among AI and semiconductor names — consistent with global peers.”Upcoming earnings will provide a key test, she said.

Earnings season is just ramping up in Japan, with memory maker Kioxia Holdings Corp. set to announce its financial performance at the end of this month. The outcome of November’s midterm elections may also bring focus to the artificial-intelligence picture.

“My impression is that the moves reflected position adjustments rather than a sudden increase in risk-off sentiment,” said Kohei Onishi, a senior investment strategist at Mitsubishi UFJ Morgan Stanley.

“With the US midterm elections this year adding uncertainty, investors were also more inclined to make such adjustments.”

The futures selling may also partly reflect overseas brokerages typically buying cash equities after the September ex-dividend period and hedging those positions by selling futures, said UK-based Japan equity analyst Pelham Smithers.