PETALING JAYA: Foreign fund sold RM372.8 million net of local equities, marking the sixth consecutive week of sell-off on the local bourse, according to MIDF Research.
However, the research house said there has been a gradual decline in foreign net selling activity for the past three weeks.
It noted that the local bourse had a rough start on Monday as foreign investors sold RM99.7 million of local equities despite an upgrade to Malaysia’s growth forecast to 4.6% from 4.2% by Fitch Ratings.
“Foreign net selling activity slowed down the next day to RM54.6 million as tables were turned
after the US plans to extend for another 90 days a limited set of exemptions that had protected
US businesses from a restriction to deal with Huawei Technologies Co,” it said in its fund flow report today.
“Nevertheless, foreign net outflow gained momentum on Wednesday to reach RM126.9 million as foreign investors returned to the sidelines ahead of the Fed’s July meeting minutes.”
MIDF said optimism returned on Thursday with foreign net selling receding to RM49.1 million after the minutes of the Fed’s July meeting highlighted that the rate cut was viewed as an insurance against headwinds from the trade war.
Friday saw continued decline in net selling activity by international funds as it slowed down to RM42.6 million which coincide with the 0.4% gain in the local bourse.
“This was in conformity with other regional peers, namely Indonesia and Taiwan ahead of the Jackson Hole address by Jerome Powell,” said MIDF.
On a year-to-date basis, foreign net outflow from Malaysia stood at RM7.02 billion, making up
around 60% of last year’s total foreign net outflow.
In terms of participation, only foreign investors experienced a weekly drop of 8.5% in the average daily traded value (ADTV) of RM899 million, below the RM1 billion mark. This is the lowest ADTV sin seven weeks.
