KUALA LUMPUR (June 10): Foreign funds mopped up RM350 million of local equities last week, compared to the paltry RM48.8 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 seven times more compared to the amount acquired in the week before.
"The weekly foreign inflow seen in Malaysia was in conformity with the majority of the other six Asian markets we monitor with the exception of South Korea and the Philippines.
"Bursa started the week off on the right foot as international investors acquired RM231.5 million net of local equities on Monday, marking the second day of foreign net inflows above RM200 million," he said.
Adam said the strong momentum of foreign net buying lifted the FBM KLCI by 0.2% to settle at 1,655 points on the same day, the highest close seen since March 22, 2019.
He said much of the optimism on Monday was mainly attributable to the recently concluded corporate earnings season which had a lot of positive surprises.
"Foreign funds still made their way to Bursa on Tuesday, a day before the two-day Hari Raya Aidilfitri holidays, snapping up RM96.8 million net of local stocks.
"As the local bourse reopened from the two-day break on Friday, international funds still acquired local equities albeit at a slower pace of RM21.8 million net," he said.
Adam said last week's foreign net inflow of RM350 million net has lowered the year-to-date foreign net outflow from Malaysia to RM4.45 billion from RM4.80 billion in the preceding week.
He said the drop in investor participation for the retail market, foreign investors and local institutional funds during the holiday-shortened week was inevitable.
Nevertheless, Adam said the average daily trading value (ADTV) for foreign investors remained healthy at above RM1 billion despite the 54% weekly decline in the ADTV.
He said only the retail market had a substantially low weekly ADTV of below RM500 million, the lowest so far for the year.