International funds stage commendable return to Bursa

KUALA LUMPUR International funds has staged a commendable return to stocks listed on Bursa Malaysia despite the rhetoric between Beijing and Washington, analysts observed in the latest fund flow report.

Based on preliminary data from Bursa which excluded off market deals, the net amount snapped up by foreign investors last week amounted to RM328 million net, offsetting the RM301.3 million net disposed in the preceding week.

According to the research arm of MIDF Amanah Investment Bank Bhd (MIDF Research), the first day of the second quarter of 2018 (2Q18) started off with an attrition worth RM40.6 million net on Monday as investors were cautious regarding the timing of Malaysia’s 14th General Election (GE14).

“The level of foreign attrition later peaked on Wednesday at US$90.1 million net as investors digested China’s move to impose a tariff of 25 per cent on US$50 billion worth of US products.

“Southeast Asian markets including Malaysia and its peers were badly hit on Wednesday as all three posted daily losses of more than one per cent,” the research arm said.

“Nontheless, foreign investors made their way back to Bursa on the next day, acquiring RM158.9 million net of local equities amid news of possible talks between the US and China regarding trade.

“It is noteworthy that foreign investors still entered Malaysia at a higher pace of RM212 million net on Friday despite threats by US President Donald Trump to slap US$100 billion in additional tariffs on China.

“The upbeat momentum was probably buoyed the GE14 that has come in sight after the announcement that parliament will be dissolved on Saturday.”

The research arm noted that Malaysia was the only beneficiary of inflows last week among the four Asean markets it tracked.

MIDF Research highlighted that on a year-to-date basis, foreigners have so far accumulated RM2.53 billion net of local equities.

It further highlighted that out of the 14 weeks that have passed in 2018, only three experienced net outflows.

On foreign participation, MIDF Research pointed out that it improved a bit as the foreign average daily trade value (ADTV) increased by 13 per cent to settle above the RM1 billion mark.

“The retail market too was vibrant with the ADTV also increasing by 13 per cent to RM953 million.”

Genting Bhd registered the highest net money inflow of RM11.13 million last week. Telekom Malaysia Bhd recorded the second highest net money inflow of RM3.33 million. Padini Holdings saw the third highest net money inflow of RM2.41 million.