Foreign funds sold RM1.05 billion M’sian equity last week, says MIDF Research

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KUALA LUMPUR (Oct 15): Foreign funds withdrew RM1.05 billion from local equity at Bursa Malaysia last week, compared to a net inflow of RM69 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 largest weekly foreign net outflow in 16 weeks.

Nevertheless, he said Malaysia saw the second lowest level of foreign attrition last week amongst the four ASEAN markets he monitors.

“International investors were net sellers on every single day of the week. Monday’s foreign net selling of RM227.2 million was of no surprise as investors reacted towards Sunday’s announcement of the termination of the MMC-Gamuda’s underground work contract for MRT2.

“The level of foreign net selling then tapered to go below RM200 million on the next two days; Tuesday and Wednesday supported by hopes that the international retendering process of the MRT2 underground works would be reviewed by the government,” he said.

Adam however said that Thursday saw chaos as international investors sold RM327.9 million net, the highest in a month after Wall Street suffered its biggest loss in eight months overnight as technology companies remained a drag combined with worries of increasing interest rates.

He said foreign net selling then was almost halved to RM173.8 million on Friday in tandem with the rebound of the local of bourse by 1.3% following news that President Trump could meet Xi Jinping during the next G20 summit.

Adam said the total foreign net outflow from Malaysia as of last Friday stood higher RM9.7 billion, offsetting approximately more than 90% of last year’s RM10.3 billion foreign net inflow.

Meanwhile, Adam said Malaysia still retains its position as the nation with the second lowest year-to-date foreign net outflow amongst the four ASEAN markets he tracks.

He said participation amongst foreign investors, local institutional funds and investors in the retail market were strong last week as their weekly average daily traded value were higher than 20% compared to the preceding week.