Foreign fund inflows enter third week


KUALA LUMPUR: Foreign funds snapped up stocks listed on Bursa Malaysia for the third week running, acquiring RM230.2mil net of local equities last week, according to MIDF Research. 


The research house said the week started off on the right foot as international funds acquired RM114.38mil net of local equities on Monday. 


It said risk appetite on Monday was bolstered by the agreement between the U.S and China to resume trade negotiations during the G20 summit in the preceding week.


Despite more tariffs being proposed by the U.S on US$4bil worth of goods from European Union, foreign net buying activity intensified on Tuesday to reach RM143.8mil net, a level not seen since June 3.This was in conformity with other regional peers namely, Thailand and Indonesia.


The local bourse followed suit to rise 0.4%, cancelling off its year-to-date loss for the first time since March 18.


“On Wednesday, the level of foreign net buying activity slowed down substantially to RM12.6mil net but marked the sixth straight day of buying spree. 


“Trade optimism waned as investors were concerned on a trade dispute, this time between Korea and Japan,” MIDF said. 


However, the tables were turned on Thursday and Friday as foreign funds sold RM17.4mil net and RM23.3mil net of local equities respectively as investors locked in gains while economic data showed that Malaysia’s exports growth doubled to 2.5% year-on-year in May 2019 from 1.1% year-on-year in April 2019.


Last week’s foreign net inflow brings the year-to-date foreign net outflow from Malaysia to RM4.43bil. 


Meanwhile, the other six Asian markets we monitor (Korea, Thailand, Indonesia, India, Taiwan and the Philippines) have seen a foreign net inflow so far for the year.


In terms of participation, the average daily traded value (ADTV) of foreign investors experienced a decline of 13.7% to RM891.6mil for the week, below the healthy threshold of RM1bil.


Meanwhile, both retail investors and local institutional funds recorded an increase in their ADTV by more than 20% for the week.



Bursa , MIDF , fund flow

   

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