Foreign selling of Malaysia equities continued for the 9th consecutive month at RM0.73 billion in May, bringing their cumulative net sell for the five months of 2023 to RM2.84 billion, said Maybank Investment Bank Bhd (Maybank IB) in a recent report.
“43% of their net sell in the month occurred in the last 2 trading days with heavy market trades on 31 May at RM5.3 billion due to MSCI rebalancing,” said Maybank IB.
Market foreign holding was 20.0% as at 31 May, a new low since the global financial crisis. Domestic institutions bought RM0.71 billion in May, lifting their net buy for the five months of 2023 to RM2.7 billion.
Retail investors bought a small RM0.02 billion, bringing their year to date net buy to RM0.15 billion. Foreign investors’ trade participation was higher month-on-month at 31.1%; direct investment was 43.1% and retail was 25.8%.
“Across ASEAN, foreign selling was the largest in Thailand equities (-USD0.97billion) in May, followed by Malaysia (-USD0.16billion), Vietnam (-USD0.13billion) and Philippines (-USD0.08illion). Net buying occurs in Indonesia (+USD0.11billion) for the 4th sequential month,” said Maybank IB.
For the five months of 2023, foreign outflow was the largest from Thailand equities (-USD2.84 billion), followed by Malaysia (-USD0.64 billion) and Philippines (-USD0.56 billion). Inflows in Indonesia is at +USD1.38 billion while Vietnam was insignificant.
For Malaysia, the total foreign net buy/(sell) for the twelve months to May 2023, as % of market capitalisation, was -0.4%. Based on Dibots data, the top 5 stocks in MY sold by foreign investors in May were CIMB, Public Bank, RHB Bank, Tenaga and Hartalega.
The top 5 stocks bought by foreign investors during the month were Maybank, CelcomDigi, M’sia Airports, MY E.G. and YTL Corp. Year to date, foreign selling is focused on Public Bank, CIMB, Petronas Chemicals, Tenaga and RHB Bank, while buying were on Gamuda followed by M’sia Airports, CelcomDigi, NationGate and Velesto.
“Foreign flows into RM bonds slowed to RM1.5 billion in Apr 2023 from RM6.6 billion in March. US Treasury volatility eased and US rates pricing moved sideways,” said Maybank IB.
Foreign holdings of MGS+GII was unchanged at RM240.5 billion. Nonetheless, year-to-date inflows remain sizable with cumulative inflows for all RM debts totaling +RM12.9 billion in the four months of 2023 and total foreign holdings rose to RM259.7 billion.
Foreign shares of Malaysian government securities and Malaysian government securities plus government investment issues were marginally lower at 35.9% and 23% respectively.
Offsetting the RM0.25 billion net sell in Malaysia equities in Apr 2023, total portfolio flow was +RM1.3 billion in April, bringing the cumulative portfolio flow for the four months of 2023 to +RM10.8 billion.
