Foreign funds snap 8-week selling streak, bought RM192.1m local equity last week, says MIDF Research

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KUALA LUMPUR (Sept 17): Foreign funds snapped their eight-week selling streak of Malaysian equity on Bursa Malaysia and bought RM192.1 million last week, compared to dumping RM278.7 million the prior week, according to MIDF Amanah Investment Bank Bhd Research.

In his weekly fund flow report today, MIDF Research's Adam M Rahim said Bursa had a solid start to the week after a three-day weekend as international funds flocked into the Malaysian market, buying RM197.3 million net on Tuesday.

He said this is the highest foreign net inflow seen in a day since early June 2019, cheered by a rally on Wall Street amidst signs of progress in relation to trade talks between the US and China.

"Foreign investors continued to snap up local equities on Wednesday but at a slower pace of RM99.7 million net.

"This was in conformity with other markets under our coverage such as Thailand, Indonesia, the Philippines, India and Taiwan," he said.

Adam said optimism was stoked by China's move to exempt 16 types of products originating from the US from additional retaliatory tariffs effective on Sept 17 with a one-year validity period.

Nevertheless, he said offshore investors took a breather on Thursday, disposing of RM49.9 million net of local equities.

"President Trump's postponement of the 5% of extra tariffs on Chinese goods by two weeks was overshadowed by Bank Negara Malaysia's decision to keep the overnight policy rate (OPR) unchanged at 3.0%.

"Foreign net selling activity continued on Friday at a slightly faster pace of RM55.0 million despite the aggressive move by the European Central Bank to cut interest rates further below zero," he said.

Adam said for the month of September, international investors have thus far sold RM86.5 million net, the lowest amongst the seven Asian markets MIDF Research monitors.

"On a year-to-date basis, international funds have taken out RM7.43 billion worth of local equities from Bursa.

"In terms of participation, foreign investors experienced the largest weekly gain of 15.6% in the average daily traded value (ADTV) to breach the RM1.0 billion mark at RM1.15 billion," he said.