Global funds bought RM348.9m M'sian equity last week, says MIDF Research

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KUALA LUMPUR (Aug 6): Global funds accumulated RM348.9 million net of local stocks last week, compared to an outflow of RM498.4 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 that so far in 2018, global funds have been net buyers of Malaysian stocks for 15 out of 31 weeks.

He said offshore funds started week with a marginal level of attrition of only RM39.2 million net.

"Meanwhile on Tuesday, which was the last trading day of July, foreign investors mopped up RM343.5 million net, the largest inflow in a day since April 19 as the visit of China's foreign minister, Wang Yi, to Malaysia increased prospects of better bilateral ties between the two nations.

"Foreign net buying resumed on Wednesday but at a slower pace of RM151.3 million following news that the US and China may revive trade negotiations to diffuse tensions," he said.

Adam said the FBM KLCI took cue from the news to jump 0.23% to the highest close in 48 trading days at 1,788 points.

"Overseas investors returned to selling mode on Thursday to a tune of RM123.7 million as the US proposed a higher tariff of 25% on US$200 billion worth of Chinese imports.

"Nonetheless, global funds chipped in RM17 million worth of local stocks on Friday, tracking gains from the technology rally on Wall Street overnight. Pengurusan Air Selangor also announced a proposed takeover of water firm SPLASH for RM2.6 billion on the same day," he said.

Adam said that for the past three months, foreign net outflows have been gradually receding.

He said May saw global funds taking out RM5.6 billion followed by RM4.9 billion in June while July only saw foreign net selling worth RM1.7 billion.

"Amongst the four ASEAN markets we track, Malaysia has the second lowest outflow worth US$2.11 billion or RM8.45 billion after the Philippines as of last Friday on a year-to-date basis.

"The average daily traded value (ADTV) in the retail market dipped below the RM1 billion mark last week. Nonetheless, the ADTV of foreign investors remain solid above RM1 billion at RM1.16 billion," he said.