FOREIGN BUYING ON BURSA CONTINUES

At 12 weeks, influx of liquidity by overseas investors at longest streak since May 2013

KUALA LUMPUR

THERE was an influx of foreign liquidity into Bursa Malaysia last week, despite it being a four-day trading week. It stretched net foreign buying to 12 consecutive weeks, the longest since the 24-week streak that ended in May 2013, the month of the last general election, said MIDF Research.

The research house said foreign purchases of equity in the open market (excluding off-market deals) surged to RM1.45 billion, the second-highest weekly influx this year and five times more than the previous week.

“Foreign participation on Bursa Malaysia bounced strongly last week to an elevated level.

“Foreign average daily trade value (ADTV) was up by 56 per cent to RM1.34 billion. Indeed, foreign daily trade value was above RM1 billion for every single day of the week.

“Most foreign buying occurred last Tuesday and Friday, with the amounts reaching RM415.2 million and RM405.8 million net, respectively.

“In the first four months of this year, the inflow has exceeded RM400 million on five different days. By comparison, the day-count was eight in 2013, two in 2014, one in 2015 and five last year.”

MIDF Research said cumulative foreign net purchases amounted to RM2.62 billion last month, which was around half the cumulative inflow of RM4.7 billion recorded in March.

Retail participation was also starting to recover as the ADTV increased by 25 per cent to RM1.1 billion, said the research house in a note.

However, retailers were still on profittaking mode after selling for 10 weeks in a row, it added.

MIDF Research said Genting Malaysia Bhd was the biggest beneficiary of the net money inflow with RM16.51 million last week.

Its share price, however, fell 1.84 per cent, underperforming the FTSE Bursa Malaysia KLCI, which rose 0.68 per cent last week.

On this score, MIDF Research said the net inflow amid declining share prices indicated a “buy on weakness” stance among some investors.