Foreign funds sold RM415.3m Malaysian equity last week, says MIDF Research

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KUALA LUMPUR (June 17): Foreign funds dumped RM415.3 million of local equities on Bursa Malaysia last week, after having acquired RM350 million in 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 US President Donald Trump's suspension plans on punitive tariffs on goods from Mexico mainly spurred risk on mood on Bursa, attracting RM59 million net of foreign inflows on Monday.

"Apart from that, the anticipation of economic stimulus from the US Fed also lent support to investors' appetite.

"As such, the foreign net buying streak was stretched to six days, the longest since nine-day selling spree observed from the middle to the end of January 2019," he said.

Adam said the local bourse followed suit to advance 0.4% higher to settle at 1,655 points on the same day, the highest since March 22, 2019.

Nevertheless, he said it was a chaotic Tuesday as international funds offloaded RM101.5 million net of local equities, dragging the FBM KLCI down by 0.3% to reach 1,651.2 points.

He said the mood turned sombre as Trump threatened to raise tariffs on China again if President Xi Jinping does not attend the G-20 summit at the end of this month.

"The foreign net outflow continued on Wednesday to reach RM143.2 million net partially caused by the protests in Hong Kong against the proposed law allowing its citizens to be extradited in China.

"There were signs of relief on Thursday as foreign net selling receded below RM100 million to RM23.3 million," he said.

However, Adam said this was short-lived as foreign investors dumped RM206.2 million net on Friday amidst jitters caused by China's industrial output which slowed down to the weakest in 17 years, and the attack on two oil tankers in the Middle East in the Gulf of Oman.

"With two more weeks of trading left in June 2019, foreign investors have so far disposed [of] RM65.3 million net.

"On a year-to-date basis, the foreign net outflow from Malaysia stands at RM4.86 billion," he said.

Adam said average daily traded value (ADTV) of all investor groups (retail, institution and foreign) increased for the week as the majority returned from the festive holidays.