Foreign funds continued to withdraw shares listed on Bursa for the fifth uninterrupted week albeit at a slower pace, according to MIDF Research.
“Based on data from Bursa, foreign funds sold RM80.3mil net of local equities last week. This was one third of the amount disposed in the preceding week,” MIDF said in its weekly fund flow report.
The research house noted that foreign funds started the week by selling off RM83.1mil net on Monday despite the 90-day ceasefire over the trade war between Beijing and Washington.
This bucked the trend of other regional markets such as South Korea and Taiwan which experienced massive inflows following the latest international trade development.
However, MIDF said offshore investors turned net buyers as they bought RM76.1mil and RM69.9mil on Tuesday and Wednesday respectively amidst the advance in Brent crude oil price to US$62 per barrel ahead of the OPEC meeting on Thursday.
This coincided with the Ringgit’s 0.45% appreciation to its highest level in more than a month of USD/MYR4.1465.
Asian markets including Malaysia skidded and prompted investors to retreat to the sidelines following the arrest of Huawei’s chief financial officer.
As such, Malaysia saw a foreign net outflow of RM59.9mil on Thursday. Sentiment on Friday remained sour with foreign investors selling RM83.1mil net on Bursa as the OPEC meeting did not result in any production cuts. OPEC and Russia later agreed to reduce oil production by removing 1.2 million barrels per day.
“Last week’s foreign net outflow brings the year-to-date outflow from Malaysia to RM10.74bil or US$2.66bil.
“Although this amount offsets last year’s net inflow, it is not as high compared to the other two Asean peers we track namely, Thailand and Indonesia which have seen year-to-date outflows larger than US$3bil,” MIDF said.
Meanwhile, the participation rate amongst the various group of investors saw a decline across the board.
MIDF said the average daily traded value of foreign investors registered the largest weekly drop of 45.5% after declining to RM1.11bil but is still deemed healthy.