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KUALA LUMPUR (June 9): Foreign selling of Malaysian equities extended for the 16th week as funds yanked out RM1.15 billion from Bursa Malaysia last week, from RM663.8 million disposed of in the week before, said MIDF Research.
In his weekly fund flow report today, MIDF Research's Adam M Rahim said foreign investors have so far taken out RM14.4 billion net of local equities from Malaysia.
"In comparison with its other six Asian peers that we monitor, Malaysia is now the nation with the fourth smallest foreign net outflow on a year-to-date (YTD) basis.
"Bursa began the week on a sluggish note as foreign investors sold RM179.4 million on Monday," he said.
Adam said foreign investors reacted to Trump's plan to begin the process of eliminating special treatment for Hong Kong.
He said the level of foreign net inflow inched higher to RM191.4 million last Tuesday.
"Investors were balancing cautious optimism about the reopening of businesses against worries of widespread protests in the US which could disrupt the economic recovery and widen the outbreak.
"Foreign net selling peaked on Wednesday at RM387.6 million net, bucking the trend of foreign net inflows seen in peers, namely South Korea and Taiwan," he said.
Nevertheless, Adam said the local bourse was up by 2.1% to settle at 1,538.5 points supported by local institutions which bought RM545.8 million on the same day.
"Thursday saw a slightly lower foreign net outflow of RM237.8 million net before shrinking further to RM150.2 million on Friday.
"The slowdown in foreign net outflow was partly attributable to the announcement of Malaysia's short-term recovery plan on Friday which put the automobile sector in the spotlight due to the sales tax exemption on car purchases," he said.
Adam said in terms of participation, only foreign investors saw a substantial weekly decline in their average daily traded value (ADTV) of 50% to reach RM1.7 billion.
"Nevertheless, the ADTV was still healthy above the RM1 billion mark," he said.