KUALA LUMPUR (Nov 18): Foreign investors dumped RM408.5 million of Malaysian equity last week, compared to RM237.2 million the prior week, according to MIDF Amanah Investment Bank Bhd Research.

In his weekly fund flow report today, MIDF Research analyst Adam M Rahim said the week started off on a sluggish tone as international funds offloaded RM129.3 million of local equities on Monday.

He said selling activity was triggered by violent protests in Hong Kong, which caused the Hang Seng index to face its fourth biggest drop of the year.

“The foreign net outflow slowed down to RM12.9 million on Tuesday as investors awaited a speech by President Donald Trump on US trade policy and news he will likely delay a decision on whether to slap tariffs on European autos.

“International funds were then back on their feet to dump RM141.2 million net on Wednesday, causing the local stock barometer to face its largest decline since early September 2019,” he said.

Adam said shock waves were sent throughout the market as Trump hinted that existing tariffs on China will be raised if no deal is made.

“Foreign investors later sold RM68.2 million net as weak Chinese economic data showed the need for a phase one trade deal with the US to restore business confidence.

“China’s industrial output rose by 4.7% year-on-year (y-o-y) which were below estimates of 5.4% while fixed asset investment grew at the slowest pace in data dating back to 1998,” he said.

Adam said offshore investors marked their sixth straight day of selling after RM57 million net of local equities were sold.

He said risk-on mood was tempered by Malaysia’s 3Q19 GDP growth of 4.4% y-o-y, which was the weakest in a year.

Adam said the month of November has so far seen a foreign net outflow of RM594 million.

“Meanwhile on a year-to-date basis, foreign funds have taken out RM8.98 billion of local equities from Malaysia, making up 76.8% of last year’s total foreign outflow of RM11.69 billion,” he said.

He said in terms of participation, foreign investors saw a decline in average daily traded value (ADTV) of 13.6% to reach below RM1 billion at RM881.5 million.