Offshore investors continue to reduce exposure on Bursa
KUALA LUMPUR: Offshore investors continued to reduce their exposure on stocks listed on Bursa Malaysia for the 18th consecutive week, 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 sold RM600.7 million net of local equities last week.
“So far in 2020, foreign investors have sold RM15.7 million net on Bursa,” MIDF Research said.
In comparison with the other six Asian markets the research arm tracked, Malaysia still has the fourth smallest foreign net outflow on a year-to-date basis.
“As markets reopened on Monday last week, international investors took out RM358.9 million net of local equities which was a similar trend for all Asian markets on fear of a resurgence in Covid-19 outbreak.
“Nevertheless, foreign funds came into the local market at a tune of RM101.6 million net on Tuesday, snapping the three-day selling spree on Bursa.
“The modest entry of foreign funds into Malaysia on Tuesday coincided with the local bourse settling at 1,517.7 points, denoting a one
So far in 2020, foreign investors have sold RM15.7 million net on Bursa.
MIDF Research
day gain of 1.26 per cent.
“Risk-on sentiment was probably spurred on Tuesday as recovery rate of Covid-19 cases showing signs of stabilisation in the country.”
On Wednesday, MIDF Research recapped that the foreign net buying in the local market was short-lived as international funds sold RM83.3 million net.
The research arm noted that investors’ appetite probably was adversely affected by the political instability in the country with a higher likelihood of a snap election taking place as well as the fresh outbreak of the virus in Beijing.
It further noted that the level of foreign net selling increased for consecutive three days to RM155.4 million on Friday.
“Meanwhile, the overall mood in the market was sombre as investors grew warier of a second wave of Covid-19 infections, particularly in China and America showing signs of increased infections.
“Moreover, the US weekly jobless-claims data on Thursday which showed 1.5 million Americans filing for unemployment insurance in the week before was higher than forecast.”
MIDF Research also highlighted that in terms of participation, foreign investors was the only group that experienced a weekly increase in their average daily traded value (ADTV) of 7.9 per cent to reach RM1.62 billion.
“Note that the ADTV is still healthy above the RM1 billion mark.”
Overall, Top Glove Corporation Bhd registered the highest net money inflow of RM15.02 million last week, followed by Kuala Lumpur Kepong Bhd with the second highest net money inflow of RM10.88 million.
Hong Leong Bank Bhd saw the third highest net money inflow of RM8.54 million.
As for outflows, Serba Dinamik Holdings Bhd saw the largest net money outflow of 8.69 million last week.
Kossan Rubber Industries Bhd recorded the second largest net money outflow RM4.55 million during the week under review while Bursa Malaysia Bhd registered the third largest net money outflow of RM3.38 million.