Foreign selling continues for eight week in a row
KUALA LUMPUR: Stocks listed on Bursa Malaysia have been subjected to foreign selling for the past eight uninterrupted weeks.
Based on preliminary data from the bourse which excluded off market deals, the net amount offloaded by foreign investors last week stood above the RM1 billion level for the fifth time this year at minus RM1.89 billion.
As of June 22, 2018, the research arm of MIDF Amanah Investment Bank Bhd (MIDF Research) saw that offshore investors have been withdrawing Malaysian equities for 33 consecutive days since May 2, 2018.
This surpassed the 29-day selling streak recorded in early January to mid-February 2014.
“Global funds sold the most on Tuesday at RM555 million, coinciding with the FBM KLCI's largest drop in 13 trading days at 1.61 per cent as the US-China trade friction intensified,” MIDF Research said.
“Selling activity thereafter tapered below the RM400 million level on Wednesday and Thursday at RM384 million and -RM264.9 million net respectively.
“In spite of the gradual decline in attrition, the FBM KLCI moved in an opposite direction to slide further to the lowest close since February 2017 at 1,692 points on Thursday and marked its ninth straight day of losses as Telekom Malaysia Berhad led decliners, dropping as much as 12 per cent amid worries over a slash in broadband prices.”
The FBM KLCI inched higher by 0.11 per cent on Friday amidst window dressing activities before the second quarter of 2018 ends.
However, foreign selling was seen at RM444 million on the same day as the trade friction between Beijing and Washington continued to be the biggest worry amongst investors.
“We reckon that these external developments would continue to affect the pace of flows into and out of Malaysia,” it said.
Foreign participation remained active despite the 23 per cent decline in foreign average daily trade value (ADTV), the research arm observed, as the value stood above RM1b for the 12th week running.
“Although the retail ADTV was below RM1 billion for the second week at RM865 million, retailers have been entering the market for the past six consecutive weeks.
Looking at top net money inflows, Sime Darby Plantation Bhd registered the highest net money inflow of RM17.89 million last week. Public Bank Bhd recorded the second highest net money inflow of RM16.84 million.
Petronas Chemicals Bhd came in third with RM13.78 million.
Meanwhile, British American Tobacco Malaysia Bhd saw the largest net money outflow of RM11.95 million last week, followed by MY EG Services Bhd at RM11.29 million.