Foreign selling narrowed to RM421m last week, says MIDF Research

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KUALA LUMPUR (March 18): Foreign selling of Malaysian equities on Bursa Malaysia narrowed to RM421 million last week from RM903.20 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 Malaysia recorded a sizeable foreign net outflow on Monday of RM272.3 million, a level not seen since late November last year.

“Nonetheless, the magnitude of foreign attrition was not as high compared to North Asian peers such as South Korea and Taiwan which saw foreign net selling levels above RM400 million.

“The local bourse followed suit to dip by 0.9% on the same day to close at 1,664 points, the lowest close so far in 2019,” he said.

Adam said the level of foreign net selling dipped below RM100 million to RM60.9 million on Tuesday following the unexpected rise in January’s US retail sales overnight.

However, he said the amount withdrawn by offshore investors more than doubled to RM125.6 million the next day.

“Another series of tapering outflows happened again on Thursday as only RM13.4 million net was sold.

“The rebound in US business equipment orders to reach the highest in six months helped outweigh the fall the China’s industrial output to a 17-year low in the first two months of the year,” it said.

Nevertheless, Adam said global funds bought RM51.3 million net on Friday, snapping the 16-day selling streak on Bursa as China pledges to stick to its targeted stimulus with tax cuts beginning in April 2019.

“In the first two weeks of March 2019, foreign funds have sold RM1.48 billion net.

“As such, foreign funds have withdrawn RM1.27 billion net from Malaysia on a year-to-date basis,” he said.

Adam said on the regional front, Malaysia is still the nation with the only foreign net outflow amongst the four ASEAN markets MIDF Research tracks.

He said Indonesia still retains the lead with a foreign net inflow of US$686.9 million or above RM2.5 billion ahead of its presidential and general election in April 2019.