Foreign funds pumped liquidity into Bursa M’sia in first week of the year

KUALA LUMPUR: Foreign funds pumped liquidity into Bursa Malaysia Bhd (Bursa Malaysia) in the first week of 2018, observed the research arm of MIDF Amanah Investment Bank Bhd (MIDF Research) in its latest fund flow report.

According to the research firm, based on preliminary data from Bursa Malaysia which excluded off market deals, international investors mopped up RM915.1 million net of local equities last week, the biggest weekly net inflow recorded since March 2017.

“Last week, foreign investors were net buyers on all four trading days, extending the buying binge to nine trading days from December 22, 2017 to January 5, 2018.

“The last time the daily buying streak was longer than this was during the period from April 20, 2017 to May 15, 2017 which was 16 days,” it said.

MIDF Research highlighted that foreign buying peaked on Thursday as foreign investors snapped up RM316.1 million net, a level not reached since April 28, 2017.

“The heavy foreign buying on Thursday coincided with Bursa Malaysia closing above the 1,800 level for the first time in more than 2.5 years which was led by gains in Sime Darby Bhd (Sime Darby) that surged 11.2 per cent.

“Bullish Brent crude oil price also played a part in sustaining the optimism on Bursa Malaysia’s Thursday rally.”

MIDF Research noted that on Friday, the FBM KLCI continued its ascent to end the week at 1,818 points despite some tapering in foreign funds inflow to RM130.1 million net as risk-on sentiment was boosted by Malaysia’s exports which grew by 14.4 per cent year on year (y-o-y) in November 2017, highest export value ever recorded for a particular month.

The research arm further noted that looking at the foreign participation, foreign investors appear really active as they have returned back from the year-end holiday.

“The foreign average daily trade value (ADTV) was up by a staggering 127 per cent at RM1.26 billion compared to RM556 million recorded in the fi nal week of 2018,” the research arm said.

As for the retail market, MIDF Research said that it was also vibrant as the retail ADTV increased by 62 per cent from RM1.2 billion in the preceding week to RM1.9 billion last week.

Sime Darby registered the highest net money infl ow of RM5.67 million last week, followed by CIMB Group Holdings Bhd recording the second highest net money inflow of RM4.9 million and Sime Darby Plantation Bhd the third highest net money inflow of RM3.37 million.

On the other hand, Petronas Dagangan Bhd saw the largest net money outflow of RM23.07 million last week. Malayan Banking Bhd again recorded the second largest net money outflow RM9.94 million during the week under review.