GLOBAL markets rebounded last week amidst developments from China’s end to stay committed in de-escalating trade tensions with the United States.
Brent crude oil dropped 6.3% for the week to settle at US$54.47 per barrel, marking the fifth consecutive week of decline. Chinese refiners are processing 15% less crude than before the novel coronavirus outbreak as the infection crimps demand.
Meanwhile, the Organisation of the Petroleum Exporting Countries (Opec) convened three days of meetings last week which produced a recommendation to cut output by 600,000 barrels, an almost 30% addition to curbs agreed upon in December.
Fears of the virus epidemic subsided last week as well, enough to bring foreign funds back to Asia.
MIDF Research analyst Adam M Rahim says: “Based on the provisional aggregate data for the seven Asian exchanges that we track – Thailand, Indonesia, the Philippines, Korea, Taiwan, India and Malaysia – investors classified as 'foreign' mopped up US$1.02 bil net last week compared to the US$4.11 bil offloaded in the week before.”
Offshore investors continued to sell equities listed on Bursa last week albeit at a slower pace. Based on data from Bursa, international investors disposed of RM327.4 mil net of local equities last week, the third weekly foreign net outflow so far in 2020.
The FBM KLCI rebounded 2.7% last week after settling at 1,554.5 points, snapping the previous two weeks of losses. On the other hand, the ringgit depreciated by 1% against the greenback to reach US$/RM4.1395.
Kuala Lumpur Kepong Bhd registered the highest net money inflow of RM7.57 mil last week. Its share price advanced 3.51% for the week, outperforming the local bourse which had a 1.53% weekly gain.
Meanwhile, MISC Bhd recorded the second highest net money inflow of RM6.3 mil. The counter was 6.24% higher, outperforming the local bourse which had a 1.53% weekly gain.
Genting Malaysia Bhd saw the third highest net money inflow of RM6.07 mil. The share price was 0.33% higher during the week, underperforming the local bourse which was 1.53% higher.
On the other hand, Hong Leong Bank Bhd saw the largest net money outflow of RM23.79 mil last week. Its stock price was 0.63% higher, underperforming the FBM KLCI. It is notable that the net money outflow amidst advancing share price may indicate a sell on strength (SOS) stance among some investors.
Public Bank Bhd recorded the second largest net money outflow RM19.95 mil during the week under review. Its share price was 1.40% lower, underperforming the market benchmark while CIMB Group Holdings Bhd registered the third largest net money outflow of RM9.92 mil. The shares were 4.46% higher, outperforming the local benchmark. – Feb 10, 2020