For­eign funds turn net buy­ers

The Sun (Malaysia) - - SUNBIZ -

PE­TAL­ING JAYA: The lo­cal stock mar­ket saw a small for­eign tide-in of RM29.6 mil­lion af­ter the out­flow of RM193.1 mil­lion the week ear­lier, ac­cord­ing to MIDF Re­search.

Worth not­ing is that this is the first time in the year, both lo­cal and for­eign funds are net buy­ers in a week, as both cat­e­gories of in­vestors bought RM114.4 mil­lion and RM29.6 mil­lion re­spec­tively.

How­ever, the re­search house said for­eign­ers were net buy­ers ahead of Bank Ne­gara’s meet­ing to de­cide on the overnight pol­icy rate (OPR).

“On Mon­day they bought RM21 mil­lion and on Tues­day they in­creased their pur­chase to RM174.4 mil­lion.

“On Wed­nes­day, they took profit af­ter the cen­tral bank an­nounced to leave the OPR un­changed at 3%, sell­ing RM9.7 mil­lion. They re­turned as net buy­ers on Thurs­day, pur­chas­ing RM20.3 mil­lion but sold RM176.4 mil­lion on Fri­day,” it noted.

MIDF Re­search ex­plained the heavy sell­ing by for­eign funds on Fri­day was partly due to the tighter-than-ex­pected mon­e­tary pol­icy by the Euro­pean Cen­tral Bank and height­ened prospects of a US rate hike to­wards end of the week.

“They also locked in part of their prof­its ahead of the long week­end as Bursa Malaysia was closed on Mon­day to cel­e­brate Hari Raya Haji,” it added.

As of last Fri­day, the year-to-date cu­mu­la­tive net for­eign in­flow into shares listed on Bursa Malaysia in­creased to RM2.38 bil­lion from RM2.35 bil­lion a week ago.

In ret­ro­spect, for­eign­ers had off­loaded RM19.5 bil­lion in 2015 and RM6.9 bil­lion in 2014.

For­eign­ers’ par­tic­i­pa­tion rate de­creased to RM620.96 mil­lion from RM1.09 bil­lion a week ear­lier.

MIDF Re­search said lo­cal in­sti­tu­tions con­tin­ued buy­ing for the sec­ond week although at a lower pace of RM114.4 mil­lion from RM177.8 mil­lion in the pre­ced­ing week.

“Be­fore that, they had been sell­ing ev­ery week since July 8. Mean­while, lo­cal funds’ par­tic­i­pa­tion rate de­clined fur­ther to RM1.82 bil­lion,” it noted.

On the other hand, re­tail­ers turned net sell­ers last week, of­fload­ing RM144 mil­lion af­ter be­ing net buy­ers for three suc­ces­sive weeks pre­vi­ously. The quan­tum of sell­ing by re­tail­ers was the high­est since March.

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