Foreign investors exit Bursa after 3 straight weeks of net inflow

13 Jan 2020 / 17:45 H.

PETALING JAYA: International investors sold RM10.9 million net of local equities last week compared to RM28.6 million bought in the week before, marking the first week of outflow albeit at a moderate pace.

In a note by MIDF Research, Bursa began the week on a sluggish note as foreign investors took out RM57.4 million of local equities on Monday amidst the latest conflict in the Middle East between Iran and the US.

Offshore investors later returned to Malaysia on Tuesday at a tune of RM81.8 million, lifting the local stock barometer 0.8% higher to close above 1,600 points.

“Investors viewed that there will unlikely be additional armed clashes while uncertainties over global oil prices have been somewhat eased by a US decision to boost its oil production,” the research house stated.

Fears of an armed conflict spinning out of control came back to haunt markets on Wednesday after Iran fired rockets at US military bases in Iraq, which caused foreign investors disposed RM35.2 million net of local equities.

The pace at which foreign investors were selling of local equities slowed down on Thursday to RM17.5 million as both Iran and Washington appeared to shy away from an outright war.

“Nevertheless, foreign investors snapped up RM17.4 million net of local equities on Friday in anticipation of the signing of the US-China phase-one trade deal on Jan 15, 2020,” it said.

January has so far seen a foreign net inflow of RM171 million, the smallest foreign net inflow on a year-to-date basis.

In terms of participation, foreign investors had the smallest decline in average daily traded value (ADTV) amongst the other investor groups, decreasing by only 0.3% and was still below the RM1 billion mark.

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