A dozen weeks of ‘stock dumping” on Bursa by foreign funds – and counting

FOREIGN investors continued their net selling streak on Bursa Malaysia for the 12th consecutive week with net foreign outflows reaching -RM254.1 mil for the week ended July 7.

On Monday (July 3), net foreign inflows of RM83.0 mil were observed with foreign investors showing interest in stocks such as Public Bank Bhd (RM28.4 mil), Maybank (RM16.0 mil) and Gamuda Bhd (RM15.2 mil) but such trend was unsustainable, according to MIDF Research.

“Foreigners have been sellers for 21 out of 27 weeks this year with a total net foreign outflow of -RM4.45 bil,” the research house pointed out in its weekly fund flow report.

“The only two sectors that posted net foreign inflows last week were plantation (RM23.5 mil) and construction (RM22.4 mil) while the top three sectors that recorded net foreign outflows were financial services (-RM75.9 mil), consumer products & services (-RM51.2 mil) and industrial products & services (-RM50.3 mil).”

Thankfully, local institutional investors remained net buyers for the sixth consecutive week at a rate of RM200.9 mil.

Following Bank Negara Malaysia’s (BNM) decision to maintain the OPR at 3.0% on Thursday (July 6), Friday (July 7) witnessed the highest inflows (RM160.6 mil) from this investor class.

Year-to-date (YTD), local institutions have been net buyers of domestic equities for 21 out of 27 weeks with a total net inflow of RM3.93 bil.

Likewise, local retailers also remained net buyers for the second consecutive week after net buying RM53.2 mil worth of domestic equities last week. YTD, local retailers have been buyers for 15 out of 27 weeks with total net buying amounting to RM516.3 mil.

In terms of participation, there was a decrease in average daily trading volume (ADTV) by foreign investors (-17.9%) and retail investors (-1.2%), but a slight surge among local institutional investors (+3.3%).

In comparison with another four Southeast Asian markets tracked by MIDF Research last week, only Indonesia posted net foreign fund inflow with US$41.8 mil while Thailand posted the highest net outflow at -US$228.2 mil followed by Vietnam (-US$78.8 mil), Malaysia (-US$54.5 mil) and the Philippines (-US$7.4 mil).

The top three stocks with the highest net money inflow from foreign investors last week were Tenaga Nasional Bhd (RM28.4 mil), Kuala Lumpur Kepong Bhd (RM22.6 mil) and Gamuda Bhd (RM18.4 mil) – July 10, 2023

Subscribe and get top news delivered to your Inbox everyday for FREE