Malaysia’s 12M foreign net sell in oversold position? 

KUALA LUMPUR 7 July - Maybank Investment Bank Research (Maybank IB) estimates foreign shareholding in Malaysia equities should have fallen beyond 21% as of end June 2020.

Malaysia’s equity market capitalisation in the past rolling 12 month of foreign net buy/sell was at -1.5% in June 2020, exceeding a recent low of -1.4% in August to November 2015.

Meanwhile, in the Southeast Asia region, foreign selling on Malaysia equities remained the second largest in June 2020 behind Thailand.

“At e.US$3.8 billion from January until June 2020 foreign net sell in Malaysia equities was behind Thailand’s e.US$6.8 billion. 

“Cumulative foreign net sell in Malaysia equities since early 2010 (post global financial crisis) until end of June 2020 reached another high at RM24.6 billion,” said Maybank IB. 

At the bond market, foreign investors made a mild comeback in May 2020 with a net inflow of RM1.5 billion.

This lowered their outflow for January until May 2020 to RM17.4 billion. 

This compares against their net sell in equities of RM13.4 billion in the period of Jan until May 2020.

Together, net outflows from Malaysia equities and bonds from January to May were RM30.8 billion higher 2019’ net inflows at RM8.9 billion of the same period.

For the record, Malaysia’s KLCI for the first time recorded the lowest index at 1,219.7 on 19 March, a record low since July 2009 due to political instability in this country.

However, the KLCI index started to resemble the V-shape charting in the period of January until June 2020. - DagangNews.com