Foreign funds reduce pace of selldown

  • Markets
  • Monday, 06 Jul 2020

KUALA LUMPUR: Foreign funds remained as net sellers for the 20th week running although at a slower pace, according to MIDF Research.

“Offshore investors lessen the pace of net selling on Bursa as it was almost halved to a tune of RM339.4mil net of local equities last week as compared to RM624.7mil in the preceding week,” MIDF said in its weekly fund flow report.

So far in 2020, foreign investors have sold RM16.7bil net on Bursa Malaysia.

“In comparison with the other six Asian markets we track, Malaysia still has the fourth smallest foreign net outflow on a year-to-date basis,” MIDF said.

International investors took out RM12.7mil net of local equities on Monday which was a similar trend for all South East Asian markets on fear of the global surge of Covid-19 cases over the weekend, dampening hope of a faster economic recovery.

MIDF noted that the foreign net outflow occurred every day last week with Wednesday recorded the highest foreign net outflow at a tune of RM142.1mil which coincided with the decline in Malaysia’s PPI in May for the third consecutive month.

However, foreign net outflow started to subside on Thursday and Friday with the lowest foreign net outflow of the week on Friday at a tune RM8.4mil.

The lower foreign net selling on Thursday and Friday was probably due to positive newsflow on the sharp rebound of the local manufacturing sector with a PMI score of 51.0 in June, and optimistic economic data from the US and China.

MIDF said in comparison to another three South East Asian markets that it tracked, Malaysia recorded the lowest foreign net outflow followed by Indonesia and Thailand last week. While the Philippines was the only market that registered a foreign net inflow.

In terms of participation, retail and institutional groups recorded a weekly increase in their average daily traded value (ADTV) by double-digit of 38.7% and 36.7% respectively.

Foreign investors experienced the smallest weekly increase in their ADTV by 3.1% to reach RM907.3mil which was below the healthy level of RM1.0bil.

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Fund flow , Bursa Malaysia , MIDF


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