FOREIGN investors continued to offload Malaysian equities last week, taking out a sum of RM456.09 million from Monday to Thursday as compared with a RM237.33 mil outflow seen between March 6 and 9, as volatility persists.
Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said retail investors recorded net sales of RM97.75 mil compared with net buying of RM229.56 mil recorded in the previous week.
“Meanwhile, local institutions were the main buyers for the week with net purchases recorded at RM442.22 mil. The equities market appears to be discarding the disappointing economic data coming out from the US.
“Plunging US retail sales in March, higher-than-expected unemployment claims last week, and free fall in business sentiments in the recent survey all seemed to be at the back burner now,” he told Bernama.
On the other hand, he said the grim outlook shared by the International Monetary Fund (IMF) on the state of the global economy and sharp decline in global oil demand estimates by the International Energy Agency (IEA) did not seem to suppress market sentiments.
“Perhaps, the decline in the number of new infection cases of Covid-19 are fuelling hope that the economy would be reopened soon. Nonetheless, the uncertainties are still visible.
“There is no vaccine or antibody yet for the virus. Health experts are also not too keen to reopen the economy prematurely. As such, foreign investors would continue to be cautious, preferring the safe-haven assets,” he added.
Mohd Afzanizam said the Malaysian Government Securities (MGS) yields had come down quite steeply this week.
“As of yesterday, the 10-year MGS yield has fallen by 31 basis points from last week’s level. The 10-year MGS yield was at 3.06% on Thursday,” he said.
On Friday, the benchmark index FTSE Bursa Malaysia KLCI (FBM KLCI) rose 20.81 points or 1.5% to 1,407.34 from 1,386.53 at Thursday’s close.
The local index extended its gains to end the week on a firm note, underpinned by persistent buying momentum in index-linked counters amid positive market sentiment brought about by reduced COVID-19 cases, signalling global economic recovery. – April 19, 2020, Bernama
