Foreign selling amounts to RM852.2m YTD


Foreign funds continued to exit their share holdings on Bursa Malaysia for the fourth consecutive week as the ringgit suffered its eighth week of losses, according to MIDF Investment Bank Bhd Research.

In its weekly fund flow report on Monday, MIDF Research’s analyst Adam M Rahim said foreign investors were net sellers every day last week, extending the sell-off to 15 straight days as of last Friday.

He said this is the longest selling streak recorded since the 17-day binge in August 2017.

He said foreign funds remained in a selling mode in Asia for the 10th straight week although the pace has somewhat tapered.

Year-to-date (YTD) foreign fund flows into Malaysia have turned negative to net RM852 million, after strong sell-offs the week before.

Last week’s foreign withdrawal wiped out the cumulative inflows, which stood at RM40.2 million in the week before.

“The YTD outflow from Malaysia is RM852.2 million net, which is still the lowest among the Asean peers that we track,” MIDF said.

Last Monday, Malaysia and Vietnam were the only two countries in South-East Asia with YTD inflows, Adam noted.

“International investors took RM125.4 million net off the local equity market last Monday. The momentum of foreign selling ramped up to RM286.8 million net last Wednesday, coinciding with FTSE Bursa Malaysia Kuala Lumpur Composite Index’s (FBM KLCI) 2.21% daily drop, the largest since Aug 24, 2015,” he said.

The sell-off, according to MIDF, was mainly sparked by looming concerns on the nation’s debt level.

Other factors included the geopolitical tensions between Washington and Pyongyang which also led to a heavy sell-off in Asian peers like Thailand, Taiwan and the Philippines.

A higher level of foreign selling was seen last Thursday at RM322.8 million net which dragged the FBM KLCI to the lowest since late December 2017 of 1,776 points.

Nonetheless, foreign selling shrank to as low as RM80 million net last Friday with the benchmark index snapping four straight sessions of losses as it settled above 1,800 points.

“The FBM KLCI posted a weekly decline of 3.08%, the biggest since October 2015 after closing below 1,800 points, a level not seen since early this year.

“The ringgit suffered its eighth week of losses, depreciating by 0.23% to RM3.98 against the US dollar last Friday, marking the longest losing streak since September 2015,” Adam added.

Public Bank Bhd registered the highest net money inflow of RM12.76 million last week, while Petronas Chemicals Group Bhd saw the largest net money outflow of -RM20.34 million.

Foreign participation dipped as the foreign average daily trade value declined by 35%, but is still considered healthy at RM1.56 billion.