KUALA LUMPUR (Nov 19): Foreign selling of Malaysian equity on Bursa Malaysia rose to RM417.3 million last week from RM182.9 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report today, MIDF Research’s Adam M Rahim said the first three days of the week saw a gradual increase in the amount withdrawn by international funds.
He said the amount sold on Monday was RM49.5 million net which is deemed to be moderate.
“However, the level of foreign net selling swelled to RM177.8 million net on Tuesday, dragging the FBM KLCI to its lowest close in nine trading days at 1,687.57 points.
“Investor sentiment that day was hampered by the weakness of Brent crude oil price that marked its losing streak of six days coupled with Monday’s slump in technology stocks on Wall Street as one of Apple’s supplier, Lumentum Holdings Inc, issued a profit warning which triggered a 5% drop for Apple’s share price,” he said.
Adam said Wednesday registered a foreign net selling of RM200.4 million, coinciding with the ringgit’s 0.1% drop to USD/MYR4.1958, a level not seen in a year.
Meanwhile, he said the local bourse rebounded 0.1% to close at 1,688.41 points on the same day.
He explained that Wednesday’s heavy selldown was in conformity with regional peers, namely Taiwan and Thailand.
“Foreign net attrition shrank to just RM30.3 million net on Thursday as fears of trade friction waned after China sent a response to the US’s demand regarding trade reform.
“Bursa’s five-day foreign net selling streak was then snapped on Friday as foreign investors bought RM40.6 million net of local equities as optimism on the trade developments outweighed news of the resignation of Brexit Secretary, Dominic Raab,” he said.
Adam said November has so far seen a foreign net outflow of RM421.8 million.
He said while foreign investors have sold RM10.37 billion of local equities on a year-to-date basis, Malaysia still has the second lowest foreign net outflow amongst the four ASEAN markets MIDF Research monitors.