PETALING JAYA: Foreign funds sold RM80.3 million net of local equities last week, which was one third of the amount disposed of in the preceding week.
“International funds continued to withdraw shares listed on Bursa for the fifth uninterrupted week albeit at a slower pace,” MIDF Research said in its weekly fund flow report today.
It said foreign funds started the week by selling RM83.1 million net on Monday despite the 90-day ceasefire in the trade war between the US and China. This bucked the trend of other regional markets such as South Korea and Taiwan which experienced massive inflows following the latest trade development.
However, offshore investors turned net buyers as they bought RM76.1 million and RM69.9 million on Tuesday and Wednesday respectively amid the advance in Brent crude oil price to US$62 per barrel ahead of the Organisation of the Petroleum Exporting Countries meeting on Thursday. This coincided with the ringgit’s 0.45% appreciation to its highest level in more than a month of US dollar/RM4.1465.
Following the arrest of Huawei’s CFO in Canada, Asian markets including Bursa Malaysia skidded and prompted investors to retreat to the sidelines. Malaysia saw a foreign net outflow of RM59.9 million on Thursday. Sentiment on Friday remained sour with foreign investors selling RM83.1 million net on Bursa as the Opec meeting did not result in any production cuts. Nonetheless, Opec and Russia later agreed to reduce oil ouput by 1.2 million barrels per day.
“Last week’s foreign net outflow brings the year-to-date outflow from Malaysia to RM10.74 billion or US$2.66 billion. Although this amount offsets last year’s net inflow, it is not as high compared to the other two Asean peers we track namely, Thailand and Indonesia, which have seen year-to-date outflows larger than US$3 billlion,” said MIDF Research.
The participation rate among the various group of investors saw a decline across the board. The average daily traded value of foreign investors registered the largest weekly drop of 45.5% after declining to RM1.11 billion but is still deemed healthy.
