KUALA LUMPUR (April 8): Foreign selling of Malaysian equities on Bursa Malaysia widened to RM416.7 million last week from RM162.1 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 is the fourth time the weekly foreign net selling reached above RM400 million so far in 2019.

“Bursa began the quarter with an exodus of foreign funds on Monday worth RM265.1 million net, the highest in 15 trading days.

“The slump in banking stocks outweighed the signs of stabilisation shown by manufacturing activity in China in March 2019, hampering sentiment,” he said.

Adam said the local bourse followed suit to decline by 0.9% to settle at 1,628.7 points, a level not seen since late December 2016.

He said the level of foreign net selling dropped substantially to RM37 million on the next day as optimism was underpinned by the higher-than-expected jump in US’s manufacturing PMI data of 1.1 percentage point to 55.3% from the month before.

“However, Malaysia was the only market with a foreign net outflow amongst the seven Asian markets we monitor.

“Offshore investors made a modest return on Wednesday and Thursday by snapping up RM1.4 million net and RM8.8 million net respectively, following a report that the US and China have resolved most of the issues in the trade talks,” he said.

Adam said on the local front, gains in Genting spurred by its plan to acquire the Equanimity superyacht also partially supported the FBM KLCI which rose 12 points over these two days.

He said the mood turned sombre on Friday as foreign investors took out RM124.8 million net, bucking the regional trend due to the absence of catalysts from the local front.

“On a year-to-date basis, foreign funds have sold RM1.76 billion net of local equities.

“Amongst the four ASEAN markets we monitor, Malaysia has now taken over Thailand’s place as the nation with the largest foreign net outflow,” he said.

Nevertheless, Adam said the cumulative foreign net outflows from January 2018 in Malaysia is substantially lower by more than US$5 billion compared to Thailand.