KUALA LUMPUR (June 24): Foreign funds acquired RM28.3 million of local equities on Bursa Malaysia last week, compared to disposing of RM415.3 million the prior week, according to MIDF Amanah Investment Bank Bhd Research.
In his weekly fund flow report today, MIDF Research's Adam M Rahim said this was the second lowest weekly foreign net inflow recorded so far this year.
He said Bursa started the week on a rough note as foreign investors disposed of RM115 million net on Monday, as investors anticipated a slew of interest rate decisions, especially from the Federal Reserve after stronger-than-expected US data fuelled bets that the central bank may have less cause to ease monetary policy.
"Nevertheless, the level of foreign net selling tapered significantly to RM14.6 million net on Tuesday.
"This was partly attributable to the slight gains on Wall Street on Monday despite choppy trading amidst the ongoing trade dispute and the possible effect on economic growth," he said.
Adam said international funds made a decent comeback on Wednesday, acquiring RM125.2 million worth of local equities on Bursa.
He said much of the risk-on mood was spurred by the prospect of an extended meeting between US President Donald Trump and China President Xi Jinping in Japan this week at the G-20 Summit to relaunch trade talks after a month-long impasse.
"Offshore investors were back in selling mode albeit at a measurable pace of RM20.9 million net on Thursday.
"Friday was the highlight of the week as a moderate foreign net inflow of RM28.3 million partially contributed to the 0.4% gain in the FBM KLCI to reach the highest close since March 20, 2019, following the Federal Reserve's signal that it was ready to lower interest rates for the first time since 2008," he said.
Adam said that with one more week of trading left in June 2019, foreign investors have so far disposed of RM37.1 million net.
He said on a year-to-date basis, the foreign net outflow from Malaysia stands at RM4.84 billion.
"Foreign investors emerged as the investor group with the largest increase in terms of average daily traded value (ADTV) of 25.7% to RM1.45 billion.
"This is the strongest level of participation in three weeks," he said.