The different agendas of retailers and institutional investors

BURSA Malaysia was an interesting marketplace last week with both retail and institutional investors heading separate directions to mop up their stock holdings.

According to the CGS-CIMB Research’s weekly fund flow chart (for the Nov 23-27 period), local institutions were switching out of the healthcare into the financial sector.

This culminated in them being the largest net sellers of healthcare (-RM204 mil) which trumped their net buying of financial services (+RM98 mil). The three top net sells were Top Glove Corp Bhd, Kossan Rubber Industries Bhd and IHH Healthcare Bhd.

On the contrary, local retailers were the largest net buyers of healthcare (+RM113 mil) and utility stocks (+RM71.6 mil) but continued to be the largest net sellers of financial services   (-RM105 mil) last week.

Meanwhile, foreign investors were the largest net sellers of the utility (-RM125 mil) and energy (-RM41 mil) sectors last week while having deployed some of their proceeds into telecommunication and media (+RM62 mil) and financial services (+RM57 mil).

More broadly, the research house observed that investors continued to switch into COVID-19 recovery theme with the energy, property and finance sectors turning out to be among the biggest gainers during the week.

“However, investors also returned to the technology sector on the back of strong third quarter earnings,” CGS-CIMB pointed out.

The energy (+8.2% week-on-week), technology (+1.9% wow) and finance (+1.7% wow) were the three best-performing sectors last week while the weakest performing sectors were utilities (-2.8% wow), plantation (-1.5% wow) and REIT (-1.2% wow).

In a related development, CGS-CIMB noted that local retail investors had regained their risk appetite and were net buyers of RM172 mil of equities last week.

This was a significant jump from net buys of RM500,000 two weeks ago, thus propelling retail investors to be the largest net buyers in the market last week.

Meanwhile, local institutional investors took some money off the table and net sold RM75 mil of equities last week while foreign investors remained the largest net sellers although their net selling subsided to RM87 mil last week (from RM269 mil two weeks ago).

“Local nominees turned net buyer of RM32 mil equities last week from net sell position of RM80.8 mil two weeks ago,” added the research house.

Year-to-date (YTD), foreign and proprietary investors have sold RM23.4 bil and RM209 mil worth of equities respectively. This was offset by net buying from retail investors (+RM12.5 bil), local institutional investors (+RM9.1 bil) and local nominees (+RM2.1 bil).

Public Bank Bhd and Tenaga Nasional Bhd were the top net buy stocks for local institutional investors YTD as well as the top two net sell stocks for foreign investors.

The top three net buy stocks for local retail investors YTD were Top Glove Corp Bhd, Genting Bhd and CIMB Group Holdings Bhd. – Dec 1, 2020

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