Foreign funds offload RM631mil in equities from Bursa Malaysia

PETALING JAYA: After two weeks of foreign buying, foreign funds withdrew RM631.4mil net of local equities from Bursa Malaysia last week.

The offloading by international funds wipedouttheforeignnetinflowofRM458.2mil recorded in the previous week, MIDF Research said in its weekly fund flow report.

This was in line with the trend in regional markets, which saw the conclusion of a threeweek foreign buying streak in Asian markets, as international investors shifted back into selling mode.

The research house noted that provisional aggregate data for the seven Asian exchanges it tracks showed that investors classified as “foreign”, dumped US$1.4bil net last week.

In Malaysia, MIDF Research said, offshore investors were already selling a lot last Monday to a tune of RM142.3mil net, as the crisis in Turkey rippled across emerging markets.

“It came to no surprise that local stocks with exposure to Turkey such as Malaysia Airports Holdings Bhd and IHH Healthcare Bhd were the major decliners that day with losses of more than 5%,” it said in the report.

The level of foreign net attrition later slowly tapered last Tuesday and Wednesday to RM127.1mil and RM85.4mil, respectively, as the Turkish lira rebounded from the massive decline yesterday, it said.

In line with the tapering of foreign attrition, the FBM KLCI advanced on these two days while other regional markets such as Thailand and Hong Kong remained in the redzone.

At the end of last week, however, foreign net selling activity gradually accelerated to RM127.9mil and RM148.7mil on Thursday and Friday, respectively.

The acceleration was following the announcement of the country’s lower-than-expected second quarter 2018 GDP growth of 4.5% year-on-year against market expectations of 5.2%.

The research house noted that August has so far seen a foreign net outflow of RM128.6mil, while the year-to-date figure stood at RM8.6bil as of last Friday.

Malaysia, however, remains the country with the second lowest outflow among the four Asean markets monitored by MIDF Research.

“Participation among foreign investors have been active so far this year, as their weekly average daily traded value reached above RM1bil for 31 out of 33 weeks,” it noted.

Overall, the FBM KLCI’s six-week winning streak came to an end after it ended 1.23% lower for the week at 1,783 points, while the ringgit suffered its ninth consecutive week of losses after shedding 0.47% to settle at RM4.1055 per US dollar, its lowest since November 2017.