KUALA LUMPUR (March 16): Investors classified as foreign sold RM1.16 billion of Malaysian equity last week, as foreign selldown intensified significantly in line with the regional trend, according to MIDF Research.   

In his weekly fund flow report today, MIDF Research head Zulkifli Hamzah said foreign investors were net sellers every single day last week. 

He said the foreign investors had sold some RM4.57 billion of Malaysian equity year-to-date as of last Friday, compared to RM6.93 billion during the whole of 2014, according to MIDF Research. 

Zulkifli said that on last Monday, the amount offloaded of RM361 million was the third highest in a day so far this year. 

“However, the amount receded significantly as the week progressed. On Friday, net sale was only RM102 million,” he said. 

Zulkifli said that so far in 2015, there had been 11 trading days during which net foreign sale had exceeded RM200 million. 

In 2014, the corresponding number was 23 days, he said. 

He said last week’s sale increased the cumulative net foreign outflow for 2015 to RM4.57 billion. 

The cumulative foreign outflow for the entire 2014 was RM6.93 billion.

Zulkifli said the foreign participation rate (daily average gross purchase and sale) remained elevated at RM1.18 billion. 

“However, we note that foreign participation dropped below RM1 billion on Friday, indicating that the the selldown is ebbing.

“Local institutions supported the market last week, mopping up RM1.13 billion, on participation rate of RM2.14 billion. Local institutions have absorbed RM4.85 billion net so far this year. In 2014, they bought RM8.18 billion net,” he said. 

Zulkifli said retailers remained stubbornly on the sideline, although a brave few were making opportunistic purchases. 

He said retailers were marginal net buyers for the second consecutive week, buying RM25 million net.

“However, trading activity was still relatively insignificant at RM850 million. It is unlikely to vary this week in view of the school holiday,” he said. 

Commenting on the region, Zulkifli said that in general, the performance of equity markets around the world deteriorated last week.

“The weakness was mainly due to the continued rally of the dollar amid a weekly plunge in the price of crude oil.

“After seven strong weeks, the gravy train to Asia made an unsurprising stop last week. Foreign investors sold heavily in Taiwan, Indonesia and Malaysia,” he said.