PETALING JAYA: International funds ramped up their selling activity last week, marking the fifth consecutive week of foreign net outflows, with RM834.6 million being sold off, the highest weekly foreign net outflow in 17 weeks.
According to a note by MIDF Research, the week started on a subtle note with foreign investors disposing only RM23.4 million net on Monday following the stronger-than-expected manufacturing data from China.
Monday’s foreign net outflow was also the smallest in a day since late October 2019.
International investors later poured out RM260.6 million of local equities on Tuesday, after fears emerged from the United States’ intention to propose tariffs on roughly US$2.4 billion in French products in response to a digital services tax impacting US tech companies.
“Foreign net selling then peaked during the week on Wednesday at RM346.7 million net as President Trump downplayed China’s urgency in reaching a deal,” the note stated.
Offshore investors continued to reduce exposure albeit at a slower pace tune of RM88.3 million.
“Risk-on mood improved as the US and China were moving closer to agree on the amount of tariff s which will be rolled back in a phase-one trade deal despite harsh rhetoric over Hong Kong and Xinjiang,” MIDF said.
On Friday, the momentum of foreign net selling momentum slowed down further to a tune of RM80.4 million, as investors cheered the news of China planning to waive retaliatory tariffs on imports of US pork and soy by domestic companies.
The year-to-date foreign net outflow from Malaysia breached the RM10 billion mark, as of last Friday, to hit RM10.76 billion. This constitutes 92% of last year’s total foreign outflow of RM11.69 billion.
In terms of participation, foreign investors saw a huge drop in average daily traded value (ADTV) by 49.4% to reach below RM861 million, the lowest in six weeks.
