Foreign Fund Flow Into Malaysian Equity

TRACKING MONEY FLOW – MALAYSIA
•  Global funds’ aversion towards Malaysian equity is attested by the gradual but persistent outflows of late.The local bourse has received only two weeks of foreign fund inflows thus far in the fourth quarter of this year.
• Investors classified as “foreign” continued selling of Malaysian equity. These foreign investors sold a net total of –RM141.6m of Malaysian equity in the open market (i.e. excluding off-market deals) on Bursa last week, a clear rise over the -RM27.3m outflow in earlier week.

Bursa Malaysia Weekly Market Participation

•  Foreign investors were net sellers on each day except for Tuesday last week. We saw the selling intensity from the previous week spilled over into Monday trading as –RM86m net foreign funds exited our bourse. This was followed by the emergence of RM102m net buying interest on Tuesday. However, it was net selling all the way for the remainder of the week. Thenceforth, fund outflows stood at -51m on Thursday before it ebbed slightly to –RM94m on Thursday and rose again to –RM58m on Friday.
•  On cumulative basis, foreign investors remained net sellers of Malaysian stocks in 2014. The net outflow as of last Friday had increased to –RM3.89b. In 2013, Malaysia reported a net inflow of RM3.03b.

Weekly Net Foreign Fund Flow Into Malaysian Equity (RM’b) Since Jan 2013

•  Foreign participation rate nonetheless risen slightly last week. Daily average gross purchase and sale increased to RM777m from RM724m recorded in the prior week.
•  In contrast, we saw lower local participation rates.
•  In the retail market, the average daily gross purchase and sale declined from RM789m to RM742m. In spite
of the lower participation rate, local retailers were the net buyers for last week.
•  Local institutions’ participation rate more than halved to RM1.8b from RM2.1b in earlier week. Furthermore, they continued to be net sellers for the fourth week in a row.

by MIDF