Investors resume buying on Bursa Malaysia
KUALA LUMPUR: The nine weeks of foreign net selling came to an end as offshore investors increased their exposure on stocks listed on Bursa Malaysia.
Based on data from the bourse, foreign funds mopped up RM25.5 million net of local equities last week.
Monday recorded a foreign net outflow of RM86.3 million, the highest in nine trading days while the local bourse gained 0.56 per cent to close at 1,679 points.
The level of foreign net selling slightly eased on the next day to minus US$75.9 million.
Wednesday was the turning point for the week as foreign investors bought RM16.4 million net, snapping three days of foreign selling.
According to MIDF Amanah Investment Bank Bhd (MIDF Research), this was in conformity with other Asian peers that it tracked such as Taiwan, South Korea, Indonesia and the Philippines.
“The return of foreign investors to Malaysia was inevitable amidst the regional upbeat sentiment from the three-day discussion between the US and China.
“Foreign investors gradually increased their holdings on stocks listed on Bursa Malaysia thereafter until the foreign net buying level reached RM106.7 million on Friday itself.”
The firm saw that this was the highest daily foreign net inflow in nearly a month with much of the support not just coming from the progress in US-China trade relations, but also the advance in Brent crude oil prices amidst growing optimism over OPEC production cuts.
So far in 2019, foreign funds bought RM7.2 million net or US$1.9 million net of local equities.
In comparison to the other two Asean peers MIDF monitors, namely the Philippines and Indonesia, Malaysia has the lowest foreign net infl ow on a year-to-date basis.
Meanwhile, Thailand is the only Asean peer with a foreign net outflow amounting to US$175.7 million.
“The participation rate amongst the various group of investors saw a stark improvement across the board to reach a healthy level,” it opined.
“For instance, the average daily traded value (ADTV) for foreign investors jumped by more than 80 per cent for the week to reach RM1.2 billion, the highest in six weeks.”
On net money inflows, Kuala Lumpur Kepong Bhd registered the highest net money inflow of RM27.88 million last week.
This was followed by CIMB Group Holdings Berhad with an inflow of RM26.72 million and Hong Leong Financial Group with RM9.99 million.
Meanwhile, Hong Leong Bank Bhd saw the largest net money outflow of RM16.51 million last week. Nestle (Malaysia) Bhd recorded the second largest net money outflow RM12.65 million during the week under review, followed by Public Bank Bhd registered the third largest net money outflow of RM11.11 million.