Foreign investors sold net RM830m of equities on Bursa last week

PETALING JAYA: The outflow of foreign capital from Bursa Malaysia-listed companies resumed its intensity last week after the Hari Raya Aidilfitri break and foreign investors sold RM830.1 million worth of equities on a net basis.

MIDF Research said this was the fifth highest outflow in a week this year and foreign investors have now been net sellers on Bursa for 13 consecutive weeks, the longest stretch of back-to-back weekly selldowns since the 2008 Asian Financial Crisis.
Foreigners were net sellers every day last week. Indeed, selling remained unrelentless and net outflow had been recorded in the last 54 out of the last 60 trading days – since April 29, 2015, which marked the beginning of the current wave of foreign liquidity exiting Malaysian equities.
"We note that foreign withdrawal exceeded RM200 million only on Tuesday when investors offloaded RM269 million, the 10th highest in a day this year. It was also the 23rd time that the figure exceeded the RM200 million mark this year, matching the count for the entire 2014. However, we reiterate our view that the heaviest of the foreign selldown is in the past," MIDF Rsearch said in its fund flow report yesterday.
For 2015, last week's selldown increased the cumulative net foreign outflow to RM10.9 billion, significantly surpassing the RM6.9 billion outflow for the whole of 2014.
Despite the significant outflow, foreign participation remained "moderate". Indeed, daily volume for the week averaged only RM775 million, the second lowest this year. Foreign trading volume fell below RM600 million on Friday.
Local institutions mopped up RM874 million in the open market last week on a depressed participation rate of only RM1.65 billion, the second lowest in 2015.
Retailers sold RM43 million net, on rising participation. Average daily gross trade rose to RM744 million, the highest in nine weeks.
Meanwhile, MIDF Research expects the local market to stay sombre in this last week of July.
"In addition, the FBM KLCI and the FBM70 are in technical sour spots, with both indices trading below short-term and long-term supports."
It expects a good week for trading in small cap this week as retail participation is picking up.