Foreign investors continue offloading activity, selling RM408.5m last week

18 Nov 2019 / 11:31 H.

PETALING JAYA: The momentum of selling activity by offshore investors on Bursa gained pace last week, with foreign investors taking out RM408.5 million of local equities last week compared to RM237.2 million net sold in the preceding week.

In a note, MIDF Research said the week had gotten off to a sluggish start as international funds offloaded RM129.3 million of local equities last Monday.

“Selling activity was triggered by violent protests in Hong Kong which caused the Hang Seng index to face its fourth biggest drop of the year.

“The foreign net outflow slowed down to RM12.9 million on Tuesday as investors awaited a speech by President Donald Trump on US trade policy and news he will likely delay a decision on whether to slap tariffs on European autos,” it said.

On Wednesday, investors sold off RM141.2 million net of local equities, causing Bursa Malaysia to face its largest decline since early September 2019.

“Shock waves were sent throughout the market as President Trump hinted that existing tariffs on China will be raised if no deal is made,” the report said.

Foreign investors later sold RM68.2 million as weak Chinese economic data showed the need for a phase one trade deal with the US to restore business confidence.

“Offshore investors marked their sixth straight day of selling after RM57 million of local equities were sold. Risk-on mood was tempered by Malaysia’s 3Q19 GDP growth of 4.4% year-on-year which was the weakest in a year.”

The month of November has so far seen a foreign net outflow of RM594 million.

Meanwhile on a year-to-date basis, foreign funds have taken out RM8.98 billion of local equities from Malaysia, making up 76.8% of last year’s total foreign outflow of RM11.69 billion.

In terms of participation, foreign investors saw a 13.6% decline in average daily traded value (ADTV) to reach below RM1 billion at RM881.5 million.

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