Foreign investors sold RM544m local equity last week

PETALING JAYA: Foreign investors sold equity listed in the open market on Bursa amounted to RM544 million on a net basis last week, compared with RM537.7 million the week before.
MIDF Research head Zulkifli Hamzah said in his weekly fund flow report yesterday said the sell down was the highest in three weeks, and was also the eighth week this year that the amount had exceeded RM500 million.
"Foreign investors had been net sellers in the last four trading days. The RM174.5 million sold on Friday was the highest in eight trading days. It had been consistent selling as opposed to heavy dumping," he said.
In the last four weeks, he noted that foreigner investors had offloaded RM2.12 billion in the open market.
"This has increased the cumulative net foreign outflow in 2015 to RM4.75 billion. In comparison, the cumulative foreign outflow for the entire 2014 was RM6.93 billion," he said.
Foreign participation that includes daily average gross purchase and sale on Bursa declined further last week after dropping below RM1 billion the week before.
Zulkifli said the average amount traded was only RM840 million last week, the second lowest this year after the Chinese New Year week.
Although foreign participation is easing, overall market volume did not decline as local participation propped up market activity.
Local institutions absorbed RM568.7 million last week, the fourth straight week of purchases during which RM2.3 billion had been mopped up. Average daily trade surged to RM2.37 billion, the highest in five weeks.
"Although average retail volume rose 19% last week to RM763 million, retailers were still net sellers by RM24.7 million. However, we believe a significant portion of the selling was still associated with Malakoff Corp Bhd, whose IPO was listed two Fridays ago."
For the weeks ahead, Zulkifli expects the local market to be lumbering towards the end of the month.
"The onset of a two-week school holiday break (first fortnight of June) is also a deterrent for investors, especially retailers from building a sizeable position.
"Foreign selling is expected to persist. We are witnessing an orderly withdrawal of portfolio money from the equity market. This is positive for Bursa," he said.