Foreign funds bought RM48.8m local equities last week, says MIDF Research

KUALA LUMPUR (June 3): Foreign funds mopped up RM48.8 million of local equities last week, compared to disposing RM382.60 million the prior week, according to MIDF Amanah Investment Bank Bhd Research.

In his weekly fund report today, MIDF Research’s Adam M Rahim said this was the second lowest foreign net inflow thus far for the year.

“Bursa started the week off on a rather sombre mood as offshore investors sold RM85.7 million net of local equities.

“ The pace at which foreign investors were selling local equities increased substantially on Tuesday to RM275.6 million net, the highest in five trading days, mainly attributable to the statement of President Trump regarding the U.S’s position which is not ready to strike a trade deal with China during a state visit to Japan,” he said.

Adam said nevertheless, there was a sharp drop in foreign net selling levels on Wednesday as international funds only disposed RM25.7 million net of local equities.

He said the decline in foreign net outflows occurred despite the inclusion of Malaysia together with Singapore and Vietnam into the

U.S watchlist for currency manipulators, putting the foreign exchange policies of each nation under scrutiny.

Adam said foreign funds later staged a commendable return to Bursa on Thursday, accumulating RM150.8 million net of local equities, snapping the 14-day foreign net selling streak.

“Much of the optimism on Thursday was sparked by surprises in corporate earnings such as Telekom Malaysia Bhd which boosted its share price by 27.2% combined with some window dressing activity ahead of the month end.

“ Foreign investors acquired another RM284.9 million net of local equities on Friday despite escalated trade tensions between the US and Mexico,” he said.

Adam said the FBM KLCI followed suit to rise 0.9% to 1,651 points, a level not seen since late March 2019.

He said for the month of May 2019, international investors have sold RM2.04 billion net compared to RM5.6 billion net during the same period last year.

He said this brings the year-to-date foreign net outflow from Malaysia to RM4.80 billion.

Source: TheEdgeMarkets