KUALA LUMPUR, Dec 7 — Foreign selling expanded to RM615.4 million on Bursa Malaysia from Monday to Friday last week compared with RM86.6 million sold in the whole of the preceding week, said Bank Islam Malaysia Bhd economist Adam Mohamed Rahim.
He said last week’s Monday wreaked havoc as international investors dumped RM541 million net of local equities, the highest daily foreign net outflow since May 2018 following the latest rebalancing exercise of the MSCI index.
As such, the month of November saw RM1.1 billion worth of foreign net outflows, marking the 17th consecutive of foreign net selling on Bursa Malaysia.
“Nevertheless, the first trading day of December started on a positive note as foreign investors took the opportunity to do some bargain-hunting on Tuesday after Monday’s selldown, resulting in a foreign net inflow of RM66.0 million.
“Another catalyst for Tuesday’s (last week’s) foreign net buying activity was China’s factory activity which accelerated at the fastest pace in a decade in November, helping factories across the region to steadily recover from the Covid-19 crisis,” Adam told Bernama.
He said a measurable pace of foreign net selling was then observed at a tune of RM36.4 million on Wednesday.
Sentiment on Wednesday was somewhat dampened following the release the IHS Markit Manufacturing Purchasing Managers’ Index; a composite single-figure indicator of manufacturing performance which dipped fractionally for the fifth month in a row, down from 48.5 in October to 48.4 in November.
This reading signalled a further moderation in the health of the manufacturing sector, although the trend appears to be flattening, while the deterioration was considerably less than that seen during the first wave of the pandemic.
Adam said international investors staged a return on Thursday by acquiring RM41.4 million net of local equities, as investors took the cue from Britain’s approval of Pfizer’s Covid-19 vaccine to be rolled out this week.
Meanwhile, the Bursa Malaysia Energy Index gained the most by 4.4 per cent amongst other sectoral indices on Thursday ahead of the Organisation of the Petroleum Exporting Countries’ (Opec) meeting to make a final decision on the future volume of the oil production cuts following days of deadlocked talks.
Friday saw international investors ramping up their net selling activity to a level above RM100 million at RM145.40 million amidst jitters coming from the political turbulence in Perak, aside from that, Opec’s decision to increase production by 500,000 million barrels per day beginning January 2021.
Nevertheless, the Bursa Malaysia Energy Index gained the most by 7.5 per cent today as the 500,000 million barrels per day increase only represents 1.0 per cent of the global oil market.
On a year-to-date basis, foreign investors have taken out RM24.1 billion net of local equities in 2020.
In terms of participation for foreign investors, the average daily traded value from Monday to Friday surged to RM2.6 billion, mainly due to the rebalancing of the MSCI index.
Among Asean peers, Malaysia’s year-to-date foreign outflow remained the second largest after Thailand. — Bernama
