KUALA LUMPUR, Nov 24 — Foreign investors continued to exit Bursa Malaysia between Monday and Thursday, although the selling had narrowed to RM145.7 million from a net outflow of RM351.6 million in the same period a week earlier.
Bank Islam chief economist Dr Mohd Afzanizam Abdul Rashid said global markets remained in risk-off mode, as issues surrounding the trade negotiations between the United States (US) and China continued to hog the limelight.
Besides, he said the recent downgrading of the global growth forecast by the Organisation for Economic Co-operation and Development (OECD) also triggered risk aversion in the market.
According to Mohd Afzanizam, the latest developments in the US House of Representative and the Senate, which passed legislation aimed at protecting human rights in Hong Kong, had painted a challenging prospect for smooth US-China negotiations, as the bill could be deemed as a form of interference in China’s local politics.
“Indications from China with regards to the trade negotiations with the US seem to be positive after news reported that China officials have invited US negotiators to Beijing for more trade talks.
“Again, there seems to be hope for resolution,” he told Bernama.
Mohd Afzanizam said market players have become increasingly anxious as to how the trade friction would affect the global growth momentum next year.
The economist said the OECD’s lowering of the 2019 global growth forecast to 2.9 per cent from 3.2 per cent could lead to higher demand for safe-haven assets such as government bonds, in exchange for risky assets such as equities.
The Paris-based intergovernmental economic organisation also revised downwards its global growth target for 2020 to three per cent from 3.4 per cent in its Economic Outlook released on Thursday. — Bernama
