Largest foreign outflow in 11 weeks

PETALING JAYA: Foreign net selling on Bursa Malaysia rose significantly last week to a total of RM601.2 million net of local equities sold, marking the largest weekly foreign net outflow in 11 weeks.

According to MIDF Research, Bursa saw a marginal level of foreign net buying on Monday at only RM250,000 before markets were closed on Tuesday in conjunction with the coronation of the Yang di-Pertuan Agong.

“As markets reopened on Wednesday, foreign net selling swelled to RM334.3 million net, the highest in a day since May 16 net ahead of the Federal Reserve’s policy meeting in addition to the US-China trade talks which saw no major breakthrough,” it said in its fund flow report today.

Nevertheless, it noted that the month of August started on a positive note, with foreign investors mopping up RM40.6 million on Thursday, driven by the share price of Press Metal Aluminium Holdings Bhd which surged 6.8%.

Press Metal had signed a power purchase agreement with Syarikat SESCO Bhd, a unit of Sarawak Energy Bhd to secure power for its capacity expansion in Sarawak.

“This outweighed the disappointment from the Fed’s signal that the easing cycle will not be aggressive ahead,” said MIDF Research.

However, havoc wreaked on Friday as foreign net selling returned to levels above RM300 million at RM307.8 million, pulling the local bourse down by 0.8% to the lowest close in more than a month at 1,626.8 points.

“The high amount of foreign net outflows was in conformity with other regional peers namely Korea, Thailand, Indonesia and Taiwan following US President Donald Trump’s plan to impose a 10% tariff on a further US$300 billion (RM1.25 trillion) worth of Chinese imports,” it added.

The month of July recorded a foreign net outflow of RM79.2 million, marking the fifth month of foreign net outflow for the year. On a year-to-date basis, the foreign net outflow from Malaysia stands at RM5.01 billion.

In contrast, the other six Asian markets monitored by MIDF Research namely Korea, Thailand, Indonesia, India, Taiwan and the Philippines, have seen a foreign net inflow so far for the year with India being the largest.

source https://www.thesundaily.my/business/largest-foreign-outflow-in-11-weeks-DJ1218342