Good Start For The Year, Bursa Records Positive Foreign Inflow

It was a shortened trading week of four days on Bursa Malaysia last week foreign investors began the first week of 2023 on a positive note by net buying RM72.3m of Malaysian equities, as compared to net selling of -RM204.6m during the final week of 2022.

Like its other Southeast Asian counterparts, MIDF notes that the attraction of foreign inflows into Malaysia may be due to positive sentiments of a boost from China’s reopening. Prime Minister Datuk Seri Anwar Ibrahim also laid his foot down that decision on interest rates was the sole prerogative of Bank Negara and the government would not intervene, a move that lifted the confidence of investors. This came amidst questions directed by certain parties toward the central bank on setting the overnight policy rate (OPR).

Foreign investors net sold -RM32.3m and -RM22.6m on Tuesday and Wednesday before picking up RM86.6m and RM40.6m on Thursday and Friday respectively. The top three sectors which saw net inflows of foreign investors last week were Financial Services at RM99.2m, Construction at RM11.1m, and Energy at RM5.3m. The bottom three sectors with net outflows were Plantation at -RM15.9m, Telecommunications, and Media at -RM13.8m, and Utilities at -RM6.7m.

Local institutions turned set sellers for the week, net selling -RM124.4m. They began the week net buying RM19.2m on Tuesday, before net selling from Wednesday to Friday at -RM6.1m, -RM91.9m, and -RM45.6m. Local retailers remained the most optimistic, net buying every day, amounting to RM52.1m for the week. They net bought RM13.1m on Tuesday, RM28.7m on Wednesday, RM5.3m on Thursday, and RM5.0m on Friday.

In terms of participation, there was an increase in average daily trading volume (ADTV) among retail investors by +0.8% while there were declines among local institutions and foreign investors by -17.6% and -19.4% respectively.

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