KUALA LUMPUR (Aug 13): Overseas funds mopped up RM458.2 million net of local equities last week, higher than the RM348.9 million bought in the week before, according to MIDF Amanah Investment Bank Bhd Research.
In his weekly fund flow report today, MIDF Research's Adam M Rahim said the week started off slow as foreign investors chipped in RM3.9 million net on Monday, the lowest daily inflow so far in 2018.
"Nonetheless on Tuesday and Wednesday, foreign net buying surged to RM233.4 million and RM229.6 million respectively, as the FBM KLCI posted gains above 0.5% on both days.
"Wednesday itself was rather a remarkable day as it was the first time that the local bourse closed above 1,800 points since late of May this year," he said.
Adam said the upbeat mood on these two days were driven by the strong corporate earnings in the US especially within the financial sectors which lifted the S&P500 to the highest close since late January this year on Tuesday.
He said foreign net buying on Thursday declined to just only RM18.2 million net as investors were more cautious following China's move to slap 25% duties on an additional US$16 billion of US goods effective Aug 23, 2018, which mirrored levies by the US.
Adam said the Turkish lira's plunge to an all-time low on Friday amidst possibilities of Turkey's economic crisis spreading to other regional markets led to a foreign net attrition on Bursa Malaysia worth RM26.9 million net, snapping its five-day buying streak.
"As global investors made a comeback, the year-to-date outflow from Malaysia has been reduced from RM8.45 billion to RM8 billion as of last Friday.
"Malaysia is still the nation with the second lowest outflow amongst the four ASEAN markets we monitor," he said.
Adam said despite the 12.4% decline in average daily traded value (ADTV) amongst foreign investors, they are still considered active as the ADTV has been above RM1 billion for five straight weeks.
He explained that ADTVs among retailers and local institutions also remain solid above RM1 billion and RM2 billion, respectively.