FOREIGN shareholding of Malaysian equities has encountered a slide since the 14th General Election (GE14), falling to 20.4% as of end-February or just 0.1 percentage point shy of the previous low of 20.3% in May 2010.
Tracking the decline, CGS-CIMB Research observed that this started in May 2018 soon after GE14 or after the GE14 on May 9, 2018 when Pakatan Harapan (PH) won a simple majority in the Parliament, thus heralding the first change in government in Malaysia’s history.
Since then, the foreign shareholding level had fallen 3.8 percentage points from its peak of 24.2% in May 2018 to 20.4% as of end-February 2021.
“Foreign investors had also been net sellers in the market for 19 consecutive months or since July 2019,” noted CGS-CIMB in its fund flow report.
“Year-to-date (YTD) 2021, foreign investors have sold RM1.3 bil of Malaysian equities.
Last year, net selling by foreign investors totalled -RM24.75 bil worth of equities on Bursa Malaysia.
On a weekly basis, foreign investors turned net sellers last week (March 15-19) after two consecutive weeks of net buying.
“They were mainly selling utilities, technology and plantation sectors,” noted CGS-CIMB Research.
“The top three stocks that attracted foreign selling were Tenaga Nasional Bhd, Dagang Nexchange Bhd and Inari Amerton Bhd, while stocks with the highest foreign inflows were Supermax Corp Bhd, D&O Green Technologies Bhd and Malayan Banking Bhd (Maybank).”
Elsewhere, local nominees were net sellers to the tune of RM32 mil for the second consecutive week which lowered their YTD net buying in equities to RM1.2 bil.
Nominee investors’ top three net sells during the week were Widad Group Bhd, Mr D.I.Y Group (M) Bhd and LKL International Bhd.
Meanwhile, local institutional investors were on their 15th consecutive week of net selling.
“The good news is that their net selling fell 4% week-on-week (wow) to RM352 mil, bringing their YTD net selling to RM4.5 bil,” CGS-CIMB Research pointed out.
“Their largest net sell was in the healthcare sector; their five key net sells were Top Glove Corp Bhd, Maybank, Public Bank Bhd, G3 Global Bhd and Supermax.”
Average daily trading volume for last week grew 10% wow to 10.9 billion units while average daily trading value fell 13% wow to RM5.4 bil as investors focused on smaller-cap companies.
Retail investors’ share of total trading value was 37.8% last week (+1.5 percentage points wow), institutional investors’ share of trade rose to 29.1% (+1.4 percentage points wow), while proprietary trade was at 15.2% (-2.9 percentage points wow) and that of nominees was at 17.9% (unchanged wow). – March 23, 2021