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Foreign investors snap 2-week selling spree on Bursa

17 Feb 2020 / 11:23 H.

PETALING JAYA: Last week, foreign funds entered Bursa at a moderate pace, buying up RM70.3 million of local equities snapping the net selling seen in the previous two weeks.

At the beginning of last week, Bursa saw a foreign net outflow of RM93 million net on Monday which pulled the local bourse down by -0.8%, due to uncertainty over how fast China can resume factory operations in light of the rising death toll from the Covid-19 outbreak.

The level of foreign net selling later dropped to just RM15 million on Tuesday after the S&P500 and Nasdaq Composite index climbed to a record high as stronger-than-expected corporate earnings and employment data.

Tables were turned on Wednesday as offshore investors snapped up RM144.3 million net of local equities, the largest in a day since in more than a month.

“The foreign net inflow came amidst speculation that the spread of the Covid-19 will slow, offsetting the news of Malaysia’s 2019 GDP growth being the lowest since the global financial crisis,” MIDF Research said in its fund flow report.

Foreign net buying continued on Thursday but at a slower momentum of RM44.2 million, partly attributable to the surge in new Covid-19 cases in China after the method for counting infections was revised.

On Friday, however, foreign investors sold RM10.2 million net on Friday amidst jitters from the increasing number of Covid-19 cases which may derail global economic growth.

According to the research house, the month of February has so far seen a foreign net outflow of RM256.9 million.

Meanwhile the foreign net outfl ow from Malaysia on a year-to-date basis stands at RM395.2 million, the smallest amongst the seven Asian markets under our coverage.

In terms of participation, the average daily traded value (ADTV) of foreign investors declined the most by 16.2% for the week, but still remained at a healthy level of above RM1 billion.

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