Fund Flow Foreign investors turned net buyers last week, mopped up RM96.3m

by **Cals** Tue 01 Dec 2015, 00:24

Fund Flow
Foreign investors turned net buyers last week, mopped up RM96.3m
By Surin Murugiah / theedgemarkets.com | November 30, 2015 : 11:10 AM MYT

KUALA LUMPUR (Nov 30): Foreign investors turned net buyers, albeit marginally, riding on the positive sentiment towards the ringgit, which was the best performing Asian and Emerging Market currency last week, according to MIDF Research.
In his weekly fund flow report today, MIDF Research head Zulkifli Hamzah said foreign funds purchased RM96.3 million in the open market last week, after offloading a total of RM1 billion in the preceding fortnight.
He said there was residual foreign selling on Monday, following the attrition in the week before.
"However, foreign investors bought back relatively strongly on Tuesday, and the buying continued on Wednesday and Thursday.
"Unfortunately, concerns over Emerging Markets on Friday took its toll on the local bourse, which succumbed to a RM60 million foreign attrition," he said.
Zulkifli said that for 2015, last week's small surplus reduced the cumulative net foreign outflow to RM18.4 billion, compared with the RM6.9 billion outflow for the entire 2014.
He said that foreign presence in the local equity market was currently very low.
"We estimate the overhang of foreign liquidity for money that came in since early 2010 to be less than RM10 billion, at only RM9.5 billion," he said.
Zulkifli said despite some optimism in the first and last week of November, the month is set to record a deficit in the flow of foreign liquidity.
He said with one trading day left, the cumulative foreign fund outflow in November (until Friday) was RM843 million, adding this reversed the RM622 million inflow in October.
He explained that foreign participation rate (average daily gross trade) rose to RM933 million, the highest in five weeks, adding that local institutions sold RM46.5 million net on RM2.33 billion participation rate.
"We wrote last week about some degree of edginess in the retail market. As it turned out, the market for small cap stocks came under the weather last week, with the FBM Smallcap Index falling -1.3% on Wednesday and -0.5% on Friday.
"We expect the bearishness to continue this week as retail selling picked up pace last week," he said.
Zulkifli said retailers offloaded RM50 million last week on heightened participation as he believe many are rushing to the exit door.
He said participation spiked to RM980 million, the second highest in 2015.
Zulkifli said he expects a roller coaster ride for small cap stocks this week.