PETALING JAYA: Foreign funds pulled out RM903.2 million net of local equities last week, the largest in 21 weeks.
MIDF Research said offshore investors marked their fourth straight week of exiting Malaysia, at a relatively stronger pace.
“Foreign net selling occurred on every single day of the week, stretching the daily selling streak to 12 days, matching the period between July 2 to 17, 2018,“ the research house said in its fund flow report today.
Foreign net outflow reached RM198.6 million on Monday before swelling further to RM263.3 million on Tuesday, the largest in a day so far this year.
“Nonetheless, we observed that the massive sell down was in sync with other Asian peers namely South Korea, Indonesia and Taiwan after an overnight sell-off on Wall Street amidst an unexpected 0.6% fall in US construction spending for December 2018,“ said MIDF.
The level of foreign net selling gradually tapered on the next two days to reach RM105.2 million on Thursday. The shrinkage of foreign selling mainly came from the news of the Chinese government pledging to enact stimulus measures to boost the economy. The local bourse followed suit to marginally gain on those two days.
However, a heavy sell-off occurred again on Friday at a tune of RM193.3 million net. Losses across Asian markets including Malaysia accelerated following the 20.7% year-on-year slump on China’s exports last month.
For the first six trading days of March 2019, international investors have sold RM1.06 billion net. As such, foreign funds have so far disposed RM849.9 million net on a year-to-date basis.
On the regional front, MIDF said Malaysia is now the nation with the highest foreign net outflow amongst the four Asean markets it monitor while Indonesia continues to lead with a year-to-date foreign net inflow of US$817.9 million (RM3.34 billion) or above RM3 billlion amidst the pre-election hype taking place in the nation.
“We note that participation amongst the three investor groups remained healthy. However, only foreign investors saw an 18.4% decrease in terms of average daily traded value last week while local institutions and retail investors experienced an increase.”