Foreign investors continued their positive trend in Malaysian equities, marking the sixth consecutive week of net inflows, with a total of RM271.5 million recorded for the week ending September 20, 2024. According to MIDF Amanah Investment Bank Bhd (MIDF), the sustained buying momentum signals confidence in Malaysia’s stock market, supported by foreign interest across key sectors like financial services and healthcare.
Foreign Investor Activity
Foreign investors remained net buyers, despite the shortened trading week due to the observance of Malaysia Day and the Prophet Muhammad’s birthday on Monday, September 16. The trading data shows that:
- On Tuesday, foreign investors bought RM167.7 million worth of equities.
- On Thursday, they purchased RM122.9 million.
- On Friday, another RM57 million was added.
However, Wednesday saw a slight reversal, with foreign investors net selling RM76.1 million. This temporary shift did not impact the overall positive sentiment, as inflows resumed towards the end of the week.
Sector Performance
The sectors that attracted the highest net foreign inflows include:
- Financial services: RM352.2 million
- Healthcare: RM211.9 million
- Property: RM55.0 million
These sectors have shown resilience, attracting significant foreign investment due to their growth potential and stability in the Malaysian economy.
Conversely, certain sectors witnessed notable outflows, including:
- Utilities: RM172.3 million
- Technology: RM85.3 million
- Consumer products and services: RM49.7 million
The outflows in these sectors suggest a recalibration by foreign investors, potentially driven by short-term profit-taking or concerns about global market conditions affecting these industries.
Local Participation
Local institutions also played a key role in supporting the bourse, registering net inflows of RM38.7 million, marking the second consecutive week of positive inflows. This highlights continued local confidence in Malaysia’s stock market, particularly from institutional investors.
On the other hand, local retailers were net sellers for the second week in a row, offloading RM310.2 million worth of equities. This trend may reflect caution among retail investors amid global economic uncertainties.
Trading Volume Surge
The average daily trading volume (ADTV) increased significantly last week, showing heightened market activity across the board:
- Local retailers: +10.9%
- Local institutions: +4.9%
- Foreign investors: +42.9%
The surge in trading volumes highlights an active market, with increased participation from all investor categories despite the shortened trading week.
Market Outlook
Foreign investors’ sustained interest in Malaysian equities, particularly in sectors like financial services and healthcare, is a positive sign for the local bourse. As global economic conditions remain volatile, Malaysia’s relatively stable macroeconomic environment continues to attract foreign capital.
Moving forward, continued inflows will likely hinge on how Malaysia navigates both global and domestic economic challenges, including monetary policies and geopolitical factors. With strong institutional support and sectoral resilience, the outlook for Malaysian equities remains cautiously optimistic for the remainder of 2024.
