KUALA LUMPUR (Dec 10): Foreign selling of Malaysian equity on Bursa Malaysia narrowed to RM80.3 million from RM244.8 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 this was one third of the amount disposed of in the preceding week.

He said foreign funds started the week by selling off RM83.1 million net on Monday despite the 90-day ceasefire over the trade war between Beijing and Washington.

"This bucked the trend of other regional markets such as South Korea and Taiwan which experienced massive inflows following the latest international trade development.

"However, offshore investors turned net buyers as they bought RM76.1 million and RM69.9 million on Tuesday and Wednesday respectively amidst the advance in Brent crude oil price to US$62 (RM258.38) per barrel ahead of the OPEC (Organization of the Petroleum Exporting Countries) meeting on Thursday," he said.

Adam said this coincided with the ringgit's 0.45% appreciation to its highest level in more than a month of US$/RM4.1465.

"Following the arrest of Huawei's chief financial officer, Asian markets including Malaysia skidded and prompted investors to retreat to the sidelines.

"As such, Malaysia saw a foreign net outflow of RM59.9 million on Thursday," he said.

Adam said sentiment on Friday remained sour with foreign investors selling RM83.1 million net on Bursa as the OPEC meeting did not result in any production cuts.

Nonetheless, he said OPEC and Russia later agreed to reduce oil production by removing 1.2 million barrels per day.

Adam said last week's foreign net outflow brings the year-to-date outflow from Malaysia to RM10.74 billion or US$2.66 billion.

"Although this amount offsets last year's net inflow, it is not as high compared to the other two ASEAN peers we track, namely Thailand and Indonesia, which have seen year-to-date outflows larger than US$3 billion," he said.

Adam said the participation rate among the various group of investors saw a decline across the board.

He said the average daily traded value of foreign investors registered the largest weekly drop of 45.5% after declining to RM1.11 billion but is still deemed healthy.