This article first appeared in The Edge Financial Daily on April 24, 2018

KUALA LUMPUR: Global investors ramped up their buying activity last week, marking the third uninterrupted week of inflows to stocks listed on Bursa Malaysia, according to MIDF Research.

This is also the fifth time this year that weekly foreign buying level exceeds RM500 million, it noted.

“Based on preliminary data from Bursa, which excluded off-market deals, the net amount acquired by foreign investors last week amounted to RM582 million net, a level not seen in 12 weeks,” said its analyst Adam M Rahim in his weekly fund flow report yesterday.

Year-to-date, foreigners have so far accumulated RM3.44 billion net of local equities.

Adam said foreign investors exhibited a commendable start last Monday, buying RM111.6 million net of local equities.

“The mood turned slightly sombre [last] Tuesday as investors turned cautious about China’s economy, selling RM68.1 million net of local stocks. Nonetheless, Malaysia had the second lowest attrition [last] Tuesday after the Philippines, which experienced a net outflow of US$8.7 million (RM33.93 million) on that day,” he added.

Adam pointed out that global investors slowly returned to Bursa last Wednesday, acquiring RM87.9 million net following the rally in Wall Street overnight.

“The week’s highlight was [last] Thursday when foreign investors pumped RM430 million net worth of funds into Bursa, the highest level since March 2017.

“Heavy inflows were also seen in Asian peers amid increasing brent crude oil prices. The FBM KLCI followed suit from the influx of foreign funds to end the day at a record high of 1,895 points,” he said.

Last Friday, foreign inflows to Bursa tapered to RM20.6 million net as investors cashed in on gains from last Thursday’s rally.

Adam also said foreign investors were net buyers in 13 of the 16 weeks this year compared with 14 during the same period in 2017. “Foreign and retail participation remained healthy as their average daily trade value stood above the RM1 billion level for the 15th and 12th weeks so far in 2018 respectively.”

Global equity markets ended mixed last week amid an interplay of factors from geopolitical tensions to sector-specific issues lingering in the semiconductor space.

“International investors hit the pedal on selling activity in Asia. Based on the provisional aggregate data for the seven Asian exchanges that we track, investors classified as ‘foreign’ offloaded almost US$1.9 billion net last week, 17 times more than the amount sold in the previous week,” said Adam.