Foreign buying of Malaysian stocks moderates to RM961.1mil net

KUALA LUMPUR: The inflow of foreign funds into Bursa Malaysia continued with a net sum of RM961.1mil, which was slightly lower than RM1.06bil registered in the previous week.

The continued buying interest in local equities could be attributed to the increased risk appetite of investors for equities as they ramped up bets that the US Federal Reserve will begin cutting rates this year.

This is despite caution from US policymakers that interest rates may remain higher for longer given the uneven evidence that inflation rates are on a downward track.

A much-awaited economic release is due on Wednesday, with the first reading for the consumer price index (CPI) for the second quarter.

Meanwhile, the net inflow of foreign funds into Malaysian equities continued for a third consecutive week, despite a moderation to below the RM1bil mark.

“Throughout last week, every trading day except Thursday saw net buying activity.

“Foreign investors reverted to net buyers again on Friday, likely influenced by BNM’s decision to maintain the OPR at 3%,” said MIDF Research.

The research firm said in its weekly fund flow report that the sectors recording the highest net foreign inflows were financial services (RM268.2mil), utilities (RM242.9mil), and transportation and logistics (RM114mil), while the only sectors with net foreign outflows were industrial products and services (RM8.9mil) and REITs (RM3.8mil).

Local institutions, meanwhile, continued to be net sellers of Malaysia equities for a second week, amounting to RM724.9mil.

Local retailers maintained their net selling streak for a ninth consecutive week, totalling RM236.2mil.

In terms of participation, average daily trading volume (ADTV) increased for local retailers (17.4%) and local institutions (1.3%), whereas foreign investors experienced a 9.9% decline.