PETALING JAYA: Offshore investors continued to offload stocks listed on Bursa Malaysia for the 19th consecutive week, selling RM624.7 million net of local equities last week.
“So far in 2020, foreign investors have sold RM16.4 billion net on Bursa. In comparison with the other six Asian markets we track, Malaysia still has the fourth smallest foreign net outflow on a year-to-date basis,“ MIDF Research said in its fund flow report today.
As markets reopened on Monday last week, international investors took out RM133.8 million net of local equities which was a similar trend for all South East Asian markets on fear of a resurgence in Covid-19 outbreak that could drag the economic recovery on a longer period. Nonetheless, the local bourse managed to close slightly higher by about 0.3% to 1,511.2 points on the same day.
Note that the foreign net outflow occurred on every day last week. The foreign net selling continued to increase the next day on Tuesday at a tune of RM146.9 million before started to subside on Wednesday and Thursday with the lowest foreign net outflow of the week on Thursday at a tune of RM74.7 million.
Nonetheless, foreign net selling activity rose to RM159.7 million on Friday, which was also the highest foreign net outflow last week. Investors’ appetite was negatively affected by the downgrading of
Malaysia’s economic growth by World Bank to -3.1% from -0.1% for year 2020 announced on Thursday. The KLCI Index closed lower by about 1.3% to 1,488.1 points last week.
“In comparison to another three South East Asian markets that we tracked, Malaysia recorded the second lowest foreign net outflow and Philippines had the lowest foreign net outflow last week. While Thailand and Indonesia posted relatively higher foreign net outflow, foreign investors seemed to ease their selling last week as compared to the preceding week before.”
In terms of participation, all investor groups recorded a weekly decline in their average daily traded value (ADTV). Foreign investors experienced the largest weekly decline in their ADTV by 45.5% to reach RM880.4 million which was below the healthy level of RM1.0 billion.