By Emmanuel Samarathisa
OVERSEAS investors have yanked close to RM10 bil from the Malaysian stock market so far in 2019 amid trade tensions between the US and China and protests in Hong Kong, according to MIDF Research.
Foreign funds have sold RM9.93 bil of stocks on Bursa Malaysia between Jan 1 and Nov 29, “making up 85% of last year’s total foreign outflow of RM11.69 bil,” MIDF Research analyst Adam Mohamad Rahim said in his weekly fund flow report on Dec 2.
This effectively maintains the FBM KLCI’s status as a laggard compared to regional peers Indonesia with a total inflow of US$2.9 bil (RM12.12 bil), as well as the Philippines and Thailand with total outflows of US$67.1 mil and US$685 mil, respectively.
In his latest report for the Nov 25-29 week, Adam noted that foreign funds aggressively disposed of RM761.2 mil stocks on Bursa, “four times more compared to the preceding week.”
Risk-off appetite was fuelled by, among others, US President Donald Trump signing a bill supporting Hong Kong protesters and possible retaliation from China towards that move, which could “put a strain on current trade negotiations,” said Adam.
But the trend is not unique to Malaysia for the week under review. “In emerging Southeast Asian markets that we monitor, all of them experienced net foreign selling,” added Adam. Foreign investors dumped US$212 mil of stocks in Thailand, US$159.3 mil in the Philippines and US$189.4 mil in Indonesia.
Malayan Banking Bhd led the decline in Malaysia with a net money outflow of RM10.49 mil last week. The banking giant’s stock price was 1.27% lower for the Nov 25-29 week but outperformed the FBM KLCI which dropped 2.20%.
Banking group CIMB Group Holdings Bhd and offshore drilling specialist Velesto Energy Bhd came in second and third with outflows of RM2.76 mil and RM1.98 mil respectively.
