KUALA LUMPUR: Foreign investors pulled out RM227.4 million worth of shares from Bursa Malaysia last week, in line with other regional markets as the ringgit weakened further to 4.19 against the US dollar.
“This is compared to an inflow of RM118.8 million the week prior,” said MIDF Research.
In his weekly fund flow report yesterday, its head Zulkifli Hamzah said this week that all eyes will be on the tabulation of Budget 2017 slated for Friday.
He noted that foreign investors were net sellers last Monday (RM25.2 million), last Wednesday (RM108 million), last Thursday (RM46 million), and last Friday (RM100.2 million). They were net buyers only
last Tuesday (RM12.4 million).
“The foreigners’ participation rate fell drastically from RM1.04 billion the week earlier to RM783.2 million last week,” he added.
Year to date, the cumulative net foreign inflow contracted to RM2.19 billion compared with RM2.42 billion the week before.
“In retrospect, foreigners had offloaded RM19.5 billion in 2015 and RM6.9 billion in 2014,” he said.
Meanwhile, Zulkifli pointed out that local institutions turned net buyers during the week, loading up RM309.5 million worth of shares. That occurred after they sold off RM30.9 million in the preceding week, he said.
“Local funds were buyers [last] Monday (RM44.7 million), [last] Wednesday (RM136 million), [last] Thursday (RM51.6 million), and [last] Friday (RM109.7 million). On the other hand, they sold stocks [last] Tuesday (RM32.5 million),” he added.
Zulkifli also said retailers last week continued to sell stocks for the third successive week by offloading RM82.1 million.
“In the week earlier, they sold RM87.9 million. They were net sellers every single day last week. They divested stocks worth RM19.5 million [last] Monday, RM19.5 million [last] Tuesday, RM28 million [last] Wednesday, RM5.6 million [last] Thursday, and RM9.5 million [last] Friday,” he said.
The participation rate for all three categories of investors declined last week due to the change in macro outlook that was largely influenced by the US Federal Reserve’s (Fed) higher chances of monetary tightening in December.
“That has led to money flowing out of emerging markets. There were no visible catalysts locally,” said Zulkifli.
Regionally, he said statistics from the seven Asian markets that MIDF Research tracks revealed that global investors pulled out US$1.27 billion (RM5.35 billion) last week, partially offsetting three successive weeks of inflow, during which an inflow of US$3.4 billion had been recorded.
“Global equities fell last week due to higher chances of the Fed tightening monetary policy and expectations of below-par corporate earnings in the US. However, US stocks gained [last] Friday after strong banking earnings.
“All the Asian stock markets we track ended the week lower except for China’s CSI 300, which rose 1.62% as investors digest mixed economic indicators,” Zulkifli added.