Foreign funds remain net sellers, offloaded RM447.7mil last week

  • Markets
  • Monday, 04 Mar 2019

An analyst told Bernama that the macro factors expected to affect the FTSE Bursa Malaysia KLCI next week, includes the Group of Seven(G7) meeting as investors search for clues on the trade outlook, as well as the timing of the next interest rate hike by the US Federal Reserve (Fed) which meets on June 12.

KUALA LUMPUR: Foreign funds remained net sellers on Bursa Malaysia for the fourth consecutive week, according to MIDF Research.

In his weekly fund flow report today, MIDF Research said foreign funds disposed RM447.7mil net of local equities, the largest in nine weeks.

The research house said the local bourse gained 0.2% on Monday to settle at 1,725 points as President Trump said that he will extend the deadline to raise tariffs on Chinese goods beyond last week as progress was made between the two nations.

Nonetheless, foreign investors sold RM49.6mil net on Monday as the decline in consumer prices in January for the first time in a decade remained in investors’ minds.

On both Tuesday and Wednesday, the level of foreign net selling tapered to below RM20mil at RM14.7mil.

Foreign net selling then peaked on Thursday at RM211.6mil, the highest in a day so far in 2019 following the failure of the Trump-Kim summit in Hanoi.

Friday’s foreign net selling was still high at RM157.2mil net as the changes for the MSCI index came into effect, causing foreign funds to rebalance their portfolios in anticipation of the increased weighting of China.

For the month of February 2019, international investors dumped RM815.6mil net. This brings the year-to-date foreign net inflow into Malaysia to RM53.3mil or US$10.4mil.

“In comparison to regional peers,Malaysia remains as the nation with the lowest foreign net inflow amongst the four Asean markets we monitor with Indonesia taking the lead with a year-to-date net inflow of US$690.9mil or approximately RM2.8bil,” MIDF said.

“We note that participation amongst the three investor groups remained healthy.

“However, only foreign investors saw a 0.6% increase in terms of average daily traded value (ADTV) last week while local institutions and retail investors experienced a drop more than 4.0% in their ADTV,” the research house said.

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