KUALA LUMPUR: Foreign investors offloaded RM477.77 million net last week, making it the largest withdrawal so far this year. The last time foreign selling reached such levels was back in end of December 2016, says MIDF Research.
“After three consecutive weeks of foreign inflows, global investors took a breather as they cleared positions ahead of the long weekend.
“Based on preliminary data from Bursa which excluded off-market trades, foreign investors offloaded RM477.7 million net last week, wiping off last week’s inflow of RM345.1 million net.
“It was the first time foreign investors sold more than RM400 million for this year, making it the largest withdrawal so far, after reaching such levels back in December 2016,” the firm said in a note today.
International investors were net sellers on three out of four trading days last week. Wednesday recorded the highest outflow in a day since June 30 which amounted to RM221 million net.
On the same day, the FBM KLCI slid 0.17 per cent to close at 1,773 points, mainly dragged by CIMB which had its Japanese shareholder, Mitsubishi UFJ Financial Group selling its entire stake through an overnight block trade.
The weekly outflow was in conformity with those seen by South East Asian peers notably, Thailand and Indonesia.
“Due to last week’s massive outflow, the cumulative net inflow thus far this year into shares listed on Bursa went below RM11 billion to RM10.6 billion. “Nonetheless, outflows have only been recorded in 9 out of 38 weeks this which is a safe level.
“Foreign participation rate dipped last week amid the surge in outflows. The foreign average daily trade value (ADTV) declined by a staggering 24 per cent to retreat below the RM1b mark to settle at RM861 million.
“In contrast, retail participation remained healthy for the week. The retail ADTV increased by 7 per cent from RM940 million to breach the RM1 billion mark for the first time in 17 weeks,” it added.
CIMB registered the highest net money in-flow of RM13.01 million last week with its share price lagging with a 5.93 per cent loss against the FBM KLCI which declined by 0.86 per cent during the week under review.
“It is notable that net money inflow amidst retreating share price may indicate a buy on weakness (BOW) stance among some investors. Genting Malaysia recorded the second highest net money inflow of RM12.58 million.
“Nevertheless, its share price underperformed against the market benchmark with a 3.78 per cent drop during the review week which may attract a BOW stance among some investors.
“Maybank saw the third highest net money inflow of RM7.99 million. Its share price outperformed the market benchmark with a 1.55 per cent gain during the review week,” it said.
“Genting Bhd saw the largest net money outflow of RM14.54 million last week. Its share price also underperformed the market benchmark with a 1.02 per cent weekly loss.
“IOI Corp recorded the second largest net money outflow of RM11.19 million during the week under review. Its share price underperformed the benchmark index with a 1.29 per cent loss for the week.
“Tenaga Nasional, meanwhile, registered the third largest net money outflow at RM10.91 million. Its share price however slightly outperformed the market benchmark with a 0.82 per cent weekly loss,” it added.