Fund Inflows on last week

Foreign buying of Malaysian-listed equities jumped to a net RM328.8mil in the week ended Oct 4 compared with only RM36.5mil in the week before.

The buying bucked regional trend as foreign funds bought almost every day last week, except on last Thursday. Buying was especially strong on last Monday, when net RM251mil was mopped up.

The surplus last week increased the overhang of foreign portfolio capital which entered the Malaysian equity market in 2013 to net RM8.71bil or net US$3.05bil (based on weighted average exchange rates at the point of entry).

For money which had flowed in since January 2011, estimate the cumulative overhang to remain at net RM24.3b or net US$8.1bil.

Local institutions took the opportunity to reduce their equity exposure further. Net sale by local funds amounted to net RM221.3mil, compared with net RM132.8mil the week before. Participation rate is tapering, although it remained elevated at RM1.57bil.

Retailers appear to be jittery over events in the US opting to offload net RM107.5mil, after nibbling in the market the week before. Participation rate fell to below RM1bil.