June 8 (Reuters) - Japanese investors sold foreign stocks at the fastest pace in about five years in May, ‌as caution over Middle East hostilities and concerns ‌that a tech-driven market rally had run too far weighed on sentiment.

They sold ​foreign stocks of a net 2.72 trillion yen ($16.98 billion) during the month as they logged the largest net withdrawal since April 2021, data from Japan's Ministry of Finance (MOF) showed on Monday.

The ‌MSCI World Index, which ⁠hit a record 1,138.3 last week, is down about 2.9% so far this month, as a ⁠blowout U.S. jobs report triggered a selloff in hot AI-linked technology stocks.

Japanese investors bought a net 2.9 trillion yen worth ​of foreign ​debt securities, the most since ​May 2025.

The MOF data showed ‌that trust accounts divested a net 3.38 trillion yen of foreign stocks but pumped 3.16 trillion yen into bonds in the overseas markets.

Investment trust management companies and life insurers, meanwhile, bought a net 614.6 billion yen and 77.5 billion yen ‌worth of foreign stocks in the ​last month.

A separate set of data ​from the Bank of ​Japan showed that Japanese investors had bought 1.91 ‌trillion yen worth of U.S. ​stocks and 826.4 ​billion yen of European stocks in the first four months of this year.

They had bought British and Spanish ​stocks of 285.5 ‌billion yen and 80.1 billion yen in the first ​four months of the year.

($1 = 160.2000 yen)

(Reporting by Gaurav ​Dogra; Editing by Andrew Heavens)