KUALA LUMPUR (April 27): Foreign selling of local equity on Bursa Malaysia surged to RM1.13 billion last week from RM638.6 million the prior week, according to MIDF Research.

In his weekly Fund Flow report today, MIDF Research’s Adam M Rahim said this figure was the highest in five weeks.

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

“The YTD foreign outflow from Malaysia came to  RM10.21 billion,” he said.

Adam said Bursa started the week on a sombre note as foreign investors pulled out RM215.4 million net of local equities.

He said this was despite news that China slashed its benchmark lending rate for the second time this year to boost the nation’s economy.

“Foreign net selling activity intensified on Tuesday, reaching RM287.9 million, a level not seen in more than a month.

“Risk-off sentiment grew following the crash in U.S oil prices overnight,” he said.

Adam said this was in conformity with other Asian markets under MIDF Research’s coverage namely, South Korea, Taiwan, India and Thailand.

“Wednesday then saw a slight slowdown in foreign net outflow to a tune of RM186.6 million as interest in rubber glove manufacturer stocks helped outweighed the overall selling activity amongst off shore investors.

“Consequently the Bursa Malaysia Healthcare index added 31.8 points on the same day,” he said.

Adam said the momentum of foreign net selling was little changed at RM198.0 million on Thursday.

“The anticipation on U.S law makers moving closer to vote for the US$484 billion bill for small businesses and hospitals helped put a lid on foreign net outflows.

“Foreign net outflow then jumped to RM240.6 million on Friday amidst reports that Gilead Sciences Inc.’s potential antiviral drug for the Covid-19 had failed in its fi rst randomized clinical trial,” he said.

Adam said in terms of participation, foreign investors saw an 8.0% weekly increase in its average daily traded value (ADTV), the smallest amongst other investor groups. Nevertheless, the absolute ADTV of foreign investors remained healthy above the RM1 billion mark.

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