Foreign funds turn net buyers on Bursa – after nine weeks of selling

14 Jan 2019 / 20:10 H.

PETALING JAYA: Foreign funds mopped up RM25.5 million net of local equities last week, bringing an end to the nine weeks of foreign net selling on Bursa Malaysia.

According to MIDF Research, foreign net outflow stood at RM86.3 million on Monday, the highest in nine trading days while the local bourse gained 0.56% to close at 1,679 points.

On Tuesday, the level of foreign net selling eased slightly to US$75.9 million while Wednesday was the turning point for the week as foreign investors bought RM16.4 million net, snapping three days of foreign selling.

“This was in conformity with other Asian peers that we track such as Taiwan, South Korea, Indonesia and the Philippines. The return of foreign investors to Malaysia was inevitable amidst the regional upbeat sentiment from the three-day discussion between the US and China,” it said in its fund flow report.

Foreign investors gradually increased their holdings on stocks listed on Bursa thereafter until the foreign net buying level reached RM106.7 million on Friday itself, marking the highest daily foreign net inflow in nearly a month.

MIDF Research said that much of the support came not only from the progress in US-China trade relations, but also the advance in Brent crude oil prices amid growing optimism over the Organization of the Petroleum Exporting Countries (Opec) production cuts.

“So far in 2019, foreign funds bought RM7.2 million net or US$1.9 million net of local equities. In comparison to the other two Asean peers we monitor, namely the Philippines and Indonesia, Malaysia has the lowest foreign net inflow on a year-to-date basis. Meanwhile, Thailand is the only Asean peer with a foreign net outflow amounting to US$175.7 million,” it said.

It noted that the participation rate among the various group of investors saw a stark improvement across the board to reach a healthy level. For instance, the average daily traded value (ADTV) for foreign investors jumped by more than 80% for the week to reach RM1.2 billion, the highest in six weeks.


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