Foreign investors still actively trading despite political jitters

KUALA LUMPUR: International investors are still actively trading on Bursa despite the lingering political jitters based on the average daily traded value (ADTV) on a four-day basis from Monday to Thursday (October 19-22, 2020) which remained at a commendable at RM1.5 billion.

Bank Islam Malaysia Bhd economist Adam Mohamed Rahim said it was worthwhile to note that the ADTV of foreign investors had stayed above the RM1.0 billion mark for the past 17 consecutive weeks.

However, the volatile trading throughout the week, has led international investors to dispose of RM177 million net of total equities from Monday to Thursday, more than double the net outflow of RM86 million recorded in the same period last week.

Adam said this brought the yearto-date foreign net outflow from Malaysia to RM22.75 billion.

“The week began with a positive mood as international investors snapped up RM101.6 million net of local equities on Monday.

“The risk-on sentiment on Monday was mainly fuelled by (news of) China’s Gross Domestic Product which expanded 4.9 per cent in the third quarter of 2020 from a year ago, keeping the economy on track to be the world’s only major growth engine and validating Beijing’s aggressive approach to controlling the pandemic,” he told Bernama.

Aside from that, he said, the recent spike in Covid-19 cases especially in Malaysia had led to some buying interest in healthcare-related stocks, particularly Hartalega and Top Glove which advanced by more than three per cent on Monday, October 19.

“International funds, however, turned sellers on Tuesday at a tune of RM134.8 million amid fears of oversupply in the oil market.

“This followed Libya’s plan to ramp up its oil production from just more than 100,000 barrels per day (bpd) in early September to around 300,000 bpd currently due to the lifting of the blockade from General Khalifa Haftar,” he added.