BUSINESS

FOREIGN FUNDS EXITED BURSA AT FASTER PACE OF RM193.8 MLN LAST WEEK

14/06/2021 11:48 AM

By Niam Seet Wei

KUALA LUMPUR, June 14  -- International investors sold local equities on Bursa Malaysia at a higher rate last week, with net foreign selling widening to RM193.8 million versus RM135.6 million net sold in the preceding week.

Bank Islam Malaysia Bhd economist Adam Mohamed Rahim said foreign funds had offloaded RM389.8 million net of local equities so far this month, while on a year-to-date basis, foreign investors had sold RM3.4 billion net of local equities.

He noted that the local markets reopened on a positive mode on Tuesday after the three-day weekend, with international investors acquiring RM102.5 million net of local equities. 

“Likewise, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) closed 0.6 per cent higher as investors took their cue from the commencement of more vaccination centres in the Klang Valley from June 7, 2021,” he told Bernama.

However, the tide began to turn the next day as international investors sold RM103.3 million net of local equities on Tuesday, as sentiments turned mixed as investors digested China’s producer price inflation for May 2021, which noted that inflation continued to surge and reach the highest level since September 2008.

Adam said the net selling continued on Thursday, albeit at a slower pace of RM50.4 million net. 

“Investors remained on the sidelines ahead of the release of the United States (US) inflation data for May 2021, which was expected to be higher and may later prompt a removal of stimulus by the US Federal Reserve,” he said.

Nevertheless, he said the Chinese and US ministers’ agreeing to push forward trade and investment-linked in their first call since the start of US President Joe Biden’s administration helped to limit further foreign selling on the local market. 

“Foreign net selling momentum accelerated to the tune of RM142.6 million on Friday, as political ambiguity resurfaced with politicians having an audience with the Yang di-Pertuan Agong from Thursday to Friday. 

“Apart from that, the daily COVID-19 cases also increased to 6,849 cases on Friday from 5,671 cases on the day before,” he said.

Meanwhile, MIDF Amanah Investment Bank Bhd Research (MIDF Research) said retailers were net buyers every day during the week just ended, with the largest buying recorded on Wednesday at RM82.8 million. 

“Cumulatively, for the week, retailers bought RM191.48 million worth of equities on  Bursa Malaysia,” it said in a note today.

The research house noted that since the beginning of 2021, retailers had been the only net buyers of the local equity market to the tune of RM7.09 billion, while local institutions were net sellers to the tune of RM3.67 billion.

MIDF Research said local institutions’ cumulative weekly inflow stood at RM2.40 million, with net buying from Wednesday to Friday, noting that the only net selling done by local institutions was on Tuesday at RM106.45 million. 

“Conversely, the largest net buying was on Friday at RM72.67 million,” it said.

In terms of participation, the research house said the average daily trade value among retail investors recorded a weekly increase of 21.33 per cent, while local institutions and foreign investors recorded a weekly decrease of -21.08 per cent and -0.85 per cent, respectively.

-- BERNAMA

 

 


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