KUALA LUMPUR (March 30): Foreign selling of Malaysian equity narrowed to RM631.9 million last week from RM1.79 billion 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 this was the first time in five weeks that international funds disposed of local equities below the RM1.0 billion mark.

“In comparison to its other six Asian peers that we monitor, Malaysia remains as the nation with the third least foreign net outflow on a year-to-date (YTD) basis. The YTD foreign outflow from Malaysia came to RM7.63 billion.

“Monday recorded a foreign net outflow of RM244.2 million, dragging the local bourse 3.3% lower to 1,259.9 points.

“Sentiment was dampened as the discussions of a US stimulus package faced hurdles from the US Senate Democrats,” he said.

Adam said foreign net selling activity was lower by half at RM116.5 million net on Tuesday.

“Risk appetite returned to Asia following the Federal Reserve’s plan to buy unlimited amounts of Treasury bonds to keep borrowing costs low.

“The level of foreign net selling fell for the third consecutive day on Wednesday after offshore investors only sold RM81.6 million net,” he said.

He said US President Donald Trump’s deal with the Senate Democrats and Republics on a historic rescue package outweighed the extension of the movement control order by the Malaysian government.

“The momentum of foreign net selling inched higher to RM91.3 million net on Thursday as Malaysian’s number of Covid-19 infections reached 2,031 cases.

“Friday then saw a foreign net outflow of RM98.35 million as US unemployment surged to a record 3.3 million, amplifying economic concerns from the Covid-19 pandemic,” he said.

Adam nevertheless said the local bourse was up by 1.1% to close at a two-week high of 1,343.1 points, as investors digested the latest RM250 billion stimulus package announced by the Malaysian government.

“In terms of participation, the average daily traded value (ADTV) of foreign investors dropped the most by 41.9% to RM1.20 billion, which is still at a healthy level,” he said.

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