KUALA LUMPUR (Nov 20): Foreign selling of Malaysian equities on Bursa Malaysia intensified to RM297.1 million last week, the highest weekly attrition in seven weeks, according to MIDF Amanah Investment Bank Bhd Research.
In his weekly fund flow report today, MIDF Research’s Adam M Rahim said foreign buyers exactly matched foreign sellers on Monday.
“A bout of acquisition then took place on Tuesday where foreign investors bought RM181.3 million net, the highest net inflow in a day in almost 5 months despite the weak China industrial output data that coincided with the 0.22% dip in the FBM KLCI.
“However, foreign investors were back in selling mode thereafter until the week ended with Thursday recording the highest amount sold at US$282.1 million net,” he said.
Adam said the heavy foreign buying on Thursday saw the FBM KLCI close at an 8-month low of 1,718 points ahead of the House of Representatives’ vote for a tax cut bill.
He explained that market sentiment improved later on Friday following the strong 3Q17 GDP which climbed 6.2% that saw a 0.21% rebound in the FBM KLCI.
“Foreign selling still occurred on the same day but on a reduced level below RM100 million net.
“By virtue of the intense foreign selling last week, the cumulative year-to-date inflow has substantially decreased to RM9.00 billion from RM9.31 billion in the week before.
“Nonetheless, the year-to-date inflow still offsets approximately 31% of the total net outflow from 2014 to 2016,” he said.
Adam said foreign participation was back on its feet as the foreign average daily trade value (ADTV) surged by 27% to RM1.13 billion after three weeks of staying below the RM1 billion mark.
He said in contrast, the retail ADTV decreased by 8% to settle below the RM1 billion level at RM957 million.