Bursa sees international inflow in past 3 weeks

KUALA LUMPUR: Bursa Malaysia has so far seen international investors entering for the past three weeks, analysts observed in the latest fund flow report.

According to the research arm of MIDF Amanah Investment Bank Bhd (MIDF Research), based on data from Bursa, international investors acquired RM28.6 million net of local equities during the holiday-shortened week compared to RM69.9 million net bought in the week before.

“It was a good start of the week for Bursa as foreign funds snapped up RM42.9 million net of local equities on Monday,” MIDF Research said.

“The local stock barometer even rose 0.3 per cent higher to close at 1,615.7 points on the same day, a level not seen in nearly five months.

“The last trading day of 2019 then saw an exodus of foreign funds amounting to RM196.2 million net, dragging the local bourse by 1.7 per cent to settle below the 1,600 mark at 1,588.8 points despite US President Donald Trump agreeing to sign a trade deal on January 15, 2019.”

MIDF Research observed that as markets reopened on Thursday after the New Year break, international funds made a decent return to Bursa, acquiring RM14.9 million net of local equities.

The research arm noted that offshore investors may have taken cue of Malaysia’s manufacturing Purchasing Manager’s Index (PMI) which edged up to 50 in December 2019, the first expansion since September 2018.

“International funds later upped the ante in buying activity to purchase RM167 million net of local equities on Friday, the largest daily foreign net inflow in more than two months.

“The local bourse followed suit to gain 0.6 per cent higher to close at 1,611.4 points on the same day.”

MIDF Research recapped that in 2019, foreign investors sold RM11.14 billion of local equities from Malaysia, lower compared to RM11.69 billion seen in the previous year.

While the total foreign net outflow from Malaysia was little changed in 2019 and remained the largest amongst the Asean markets the research arm monitored, this was no match for the massive foreign net selling of RM19.49 billion seen in 2015.

“In terms of participation during the holiday-shortened week, it was no surprise that foreign investors experienced the largest gain in average daily traded value (ADTV) amongst the other investor groups, increasing 59.6 per cent but was still below the RM1 billion mark.”

Overall, Public Bank Bhd registered the highest net money inflow of RM2.6 million last week, followed by Batu Kawan Bhd with the second highest net money inflow of RM3.08 million.

Genting Malaysia Bhd saw the third highest net money inflow of RM2.55 million.

On outflows, Kuala Lumpur Kepong Bhd saw the largest net money outflow of RM7.48 million last week.

Velesto Energy Bhd recorded the second largest net money outflow RM5.35 million during the week under review while Digi. com Bhd registered the third largest net money outflow of RM4.92 million.

It was a good start of the week for Bursa as foreign funds snapped up RM42.9 million net of local equities on Monday.

MIDF Research