KUALA LUMPUR (May 25): Foreign selling of Malaysian equity does not appear to be ebbing, four weeks into the current phase of portfolio outflow, according to MIDF Research.

In his weekly fund flow report today, MIDF Research head Zulkifli Hamzah said investors classified as “foreign” sold equity listed in the open market on Bursa amounting to RM544.0 million on a net basis last week, compared with RM537.7 million the week before.

He said it was the highest in three weeks, and was also the eighth week this year that the amount had exceeded RM500 million.

Zulkifli said foreign investors had been net sellers in the last four trading days.

“The RM174.5 million sold on Friday was the highest in 8 trading days. It had been consistent selling as opposed to heavy dumping.

“In the last four weeks, foreigner investors had offloaded RM2.12 billion in the open market. This has increased the cumulative net foreign outflow in 2015 to RM4.75 billion. In comparison, the cumulative foreign outflow for the entire 2014 was RM6.93 billion,” he said.

Zulkifli said foreign participation (daily average gross purchase and sale) on Bursa declined further last week after dropping below RM1 billion the week before.

He said the average amount traded was only RM840 million last week, the second lowest this year after the Chinese New Year week (which was a truncated 2.5-day trading week).

“Although foreign participation is easing, overall market volume did not decline as local participation propped up market activity.

“Local institutions absorbed RM568.7 million last week, the 4th straight week of purchases during which RM2.3 billion had been mopped up. Average daily trade surged to RM2.37 billion, the highest in five weeks,” he said.

Zulkifli said that although average retail volume rose 19% last week to RM763 million, retailers were still net sellers by RM24.7 million.

“However, we believe a significant portion of the selling was still associated with Malakoff Corporation Bhd, whose IPO was listed two Fridays ago,” he said.