KUALA LUMPUR: After three uninterrupted weeks of foreign net inflows into stocks listed on Bursa, international investors turned into selling mode albeit at a marginal pace, according to MIDF Research.
“Based on preliminary data from Bursa which excluded off market deals, international funds sold RM69.0mil net of local equities last week, the second smallest weekly foreign net outflow recorded so far in 2018.
The research house said Bursa saw a decent foreign net inflow of RM19.7mil on Monday but was later cancelled off by a small net outflow worth RM36.2mil on Tuesday despite the revised trade pact between the U.S and Canada.
Foreign funds were on a roll on Wednesday and Thursday as they mopped up local stocks worth more than RM70mil on both days.
Interestingly, foreign investors in other regional peers namely the Philippines, Thailand, and Indonesia were reducing their exposure during the same period.
However, MIDF said offshore funds were back in selling mode on Friday but at a heightened level of RM209.3mil net, the highest in 16 trading days.
The local bourse followed suit to decline by 0.72% to 1,777 points on the same day, the lowest close since late July 2018.
It said the risk aversion was spurred by the rise in U.S 10-year treasury yields overnight which breached above 3.2%, a level not seen in 7 years.
“So far in 2018, the total foreign net outflow from Malaysia as of last Friday stood at RM8.6bil, offsetting approximately 86% of last year’s RM10.3bil foreign net inflow.
“Meanwhile, Malaysia still retains its position as the nation with the second lowest year-to-date foreign net outflow amongst the four Asean markets we track,” MIDF said.
Participation of foreign investors dipped as its weekly average daily traded value (ADTV) ended 8.2% below the RM1bil mark for the first time in 13 weeks.
Meanwhile, participation in the retail market and local institutional funds remained healthy above RM800mil and RM2bil respectively.
Source: The Star