KUALA LUMPUR, Jan 7 2019 : Foreign funds sold RM54.4 million net of local equities last week from RM127.6 million in the previous week, extending the weekly foreign selling streak to nine weeks, says MIDF Amanah Investment Bank Bhd Research (MIDF Research).
Research analyst Adam M. Rahim said the foreign selling was less than half of the amount disposed the week earlier, indicating that the momentum of foreign net outflows from the local bourse had tapered last week.
For the first three trading days of 2019, he said foreign funds pulled out RM18.3 million or US$4.5 million (US$1 = RM4.12) net of equities from Bursa Malaysia.
“The selling was substantially lower than Thailand’s outflow of US$130.4 million net, while Indonesia and the Philippines saw a net inflow of US$54.9 million and US$23.1million, respectively,” he said in MIDF Research’s weekly fund flow report today.
Adam said on New Year’s Eve, international investors sold RM36.1 million net on Bursa Malaysia, following the drop in China’s factory activity for the first time since 2016.
“The local bourse remained flat, only ending 0.1 per cent lower at 1,691 points on Monday, Dec 31.
“It was also notable that the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) gained 56 points since it hit its lowest level in 2018 of 1,635 points on Dec 18, 2018,” he said.
Adam said Bursa Malaysia kicked off 2019 on a sombre note as foreign funds sold RM55.4 million on the first trading day on Wednesday, bringing the foreign net selling streak to 12 days, the longest since the 37-day selling spree recorded from early May to late June 2018.
“Despite Apple’s slash in revenue guidance, foreign investors disregarded the news and took the opportunity to buy RM64.6 million net on Thursday, the largest daily inflow in more than two weeks,” he said.
However, he said foreign funds reverted to selling mode on Friday, albeit at a moderate pace of RM27.5 million net.
“Optimism sparked by the China’s services gauge was outweighed by disappointing US manufacturing data as the Institute for Supply Management (ISM) manufacturing index fell to 54.1 last month, the lowest level since November 2016,” he added.
Adam said the participation rate amongst the various groups of investors saw an increase across the board for the week ended Jan 4, 2019.
“The average daily traded value (ADTV) of foreign investors registered the largest weekly advance of 36 per cent, but still below the healthy level of RM1 billion,” he said. – Bernama