Foreign selling narrowed to RM11.14b in 2019, says MIDF Research

KUALA LUMPUR (Jan 6): Foreign investors sold RM11.14 billion of local equities from Malaysia in 2019, lower compared to RM11.69 billion seen in the previous year, according to MIDF Amanah Investment Bank Bhd Research.

In his weekly fund flow report today, MIDF Research’s Adam M Rahim said international investors acquired RM28.6 million net of local equities on Bursa Malaysia during the holiday-shortened last week compared to RM69.9 million bought in the prior week.

Adam said it was a good start of the week for Bursa as foreign funds snapped up RM42.9 million net of local equities on Monday.

“The local stock barometer even rose 0.3% higher to close at 1,615.7 points on the same day, a level not seen in nearly five months.

“The last trading day of 2019 then saw an exodus of foreign funds amounting to RM196.2 million net, dragging the local bourse by 1.7% to settle below the 1,600 mark at 1,588.8 points despite Trump agreeing to sign a trade deal on Jan 15, 2019,” he said.

Adam said as markets reopened on Thursday after the New Year break, international funds made a decent return to Bursa, acquiring RM14.9 million net of local equities.

He said offshore investors may have taken cue of Malaysia’s manufacturing Purchasing Manager’s Index (PMI) which edged up to 50 in December 2019, the first expansion since September 2018.

“International funds later upped the ante in buying activity to purchase RM167.0 million net of local equities on Friday, the largest daily foreign net inflow in more than two months.

“The local bourse followed suit to gain 0.6% higher to close at 1,611.4 points on the same day,” he said.

Adam said in 2019, foreign investors sold RM11.14 billion of local equities from Malaysia, lower compared to RM11.69 billion seen in the previous year.

He said while the total foreign net outflow from Malaysia was little changed in 2019 and remained the largest amongst the ASEAN markets we monitor, this was no match for the massive foreign net selling of RM19.49 billion seen in 2015.

Adam said in terms of participation during the holidayshortened week, it was no surprise that foreign investors experienced largest gain in average daily traded value (ADTV) amongst the other investor groups, increasing 59.6% but was still below the RM1.0 billion mark.