KUALA LUMPUR (Jan 3): Foreign investors turned into net sellers during the last trading week of 2022, and dumped RM204.6 million in Malaysian equities, a reversal from a net inflow of RM51.2 million the prior week.  

In its weekly fund flow report on Tuesday (Jan 3), the MIDF Research team said that the trading week was shortened due to the replacement for the Christmas holiday last Monday (Dec 26).

It said foreigners started off the week on a positive note by net buying RM10.1 million last Tuesday, and RM99.2 million last Wednesday.

However, it said the amount net bought was inadequate to overturn the profit taking that took place last Thursday at a rate of RM9.8 million, and at RM304.1 million last Friday.

“The top three sectors that saw net foreign inflows were healthcare at RM16.5 million, technology at RM12.3 million, and transportation and logistics at RM7.2 million.

“Meanwhile, the top three sectors that saw net foreign outflows were plantation at RM64.7 million, industrial products and services at RM57.1 million, and financial services at RM46.0 million,” it said.

Meanwhile, it said local institutions were seen accumulating domestic equities, as they net bought RM290.4 million last week.

During the week ended Dec 23, they net sold RM52.1 million worth of equities.

Last Tuesday (-RM44.6 million) and last Wednesday (-RM149.0 million) were net selling days.

“Their investing stance took a positive turn last Thursday, as they net bought RM41.6 million, with the heaviest net buying seen last Friday at RM442.4 million.

“On the other hand, local retailers turned into net sellers at a rate of RM85.8 million,” it said.

MIDF said they had been net buying for three consecutive weeks prior to that.

The research house said local retailers net bought RM34.4 million last Tuesday, and RM49.9 million last Wednesday.

“They started taking profit for the rest of the week at a rate of RM31.8 million last Thursday, and RM138.3 million last Friday.

“At the end of calendar year 2022, foreign investors were net buyers for 27 out of 52 weeks of 2022, with a total net inflow of RM4.38 billion,” it said.

MIDF said that in contrast, local institutions were net sellers for 33 weeks out of 52 weeks of 2022, with a total net outflow of RM6.42 billion.

It said local retailers were also net buyers for 33 weeks out of 52 weeks of 2022, with a total net inflow of RM2.04 billion.

In terms of participation, the average daily trading volume for local retailers (+10.0%), local institutions (+32.6%) and foreign investors (+18.8%) recorded growth last week.

Commenting on global markets, MIDF said benchmark indices in the US ended 2022 lower last Friday, marking a year of sharp losses attributed by a myriad of challenges, including recession fears, aggressive interest rate hikes, the Russia-Ukraine war, and China’s zero-Covid policy.

It said that for the year, the S&P 500 lost 19.4%, and the Dow Jones Industrial Average shed 8.9%, while the Nasdaq Composite Index fell by 33.1%.

It added that the percentage declines were the biggest since the 2008 financial crisis.

“On a weekly basis, the S&P 500 declined by 0.1% to 3,839.50, and the Dow lost 0.2% to 33,147.25, while Nasdaq shed 0.3% to 10,466.48.

“Out of the 20 major indices that we track, most saw weekly declines, led by South Korea’s Kospi (3.3%), Vietnam’s Ho Chi Minh VSE (1.3%), and Australia’s ASX 200 (1.0%).

“Among the best performing markets last week were Thailand’s SET (3.2%), India’s Sensex (1.7%), and the FBM KLCI (1.4%),” it said.