Foreign investors turned net buyers in Asian markets last week, reversing the previous week’s outflow, recording an inflow of US$996 million (RM4.22 billion), with Taiwan recording the highest purchases in the region.
MBSB Investment Bank Bhd’s fund flow report for the week ended Aug 8 reported that only India and the Philippines registered net foreign outflows, while all other countries saw net inflows.
It said Taiwan posted the region’s largest net inflow at US$2.06 billion, more than 2.5 times the previous week’s US$820.8 million, marking a seventh consecutive week of foreign buying, with sentiment lifted by the second quarter of calendar year 2025's gross domestic product growth.
“Fitch reaffirmed Taiwan’s long-term sovereign rating at ‘AA’ with a stable outlook, citing strong fiscal discipline and robust external balances.
“However, the outlook is clouded by potential 100% tariffs on semiconductor imports, which account for around 80% of Taiwan’s US-bound exports,” the report said.
Meanwhile, South Korea recorded a net inflow of US$344.9 million, extending foreign investors’ buying streak to five weeks, supported by moderating inflation and resilient export performance.
It said Thailand attracted US$199.5 million, 3.6 times higher than the prior week’s US$54.9 million, after the GDP growth forecast was revised upward following the US tariff cut for Thai goods.
Regarding outflows, MBSB noted that India recorded the region’s largest outflow at US$1.34 billion, extending its losing streak to four weeks, as investors weighed tariff risks and monetary policy signals.
The Reserve Bank of India kept its policy repo (repurchase) rate unchanged at 5.5% and maintained its financial year 2026 GDP growth forecast at 6.5%, citing a more benign inflation outlook but warning of potential growth risks from prolonged 50% US tariffs, said the report.
It said the Philippines saw a marginal outflow of US$100,000, its second week of net selling, despite reporting 2Q2025 GDP growth of 5.5% year-on-year — the fastest pace in a year — on a sharp rebound in agriculture and steady household spending.
“The recent reduction in US tariffs on Philippine goods from 20% to 19% has eased some external headwinds, while the central bank remains watchful of inflation risks from geopolitical tensions and external policy uncertainty,” it added.
On the domestic front, the investment bank said foreign investors extended their net selling streak to their fifth consecutive week, registering a net outflow of RM1.14 billion, with the largest outflow recorded on Tuesday (RM291 million).
“The only two sectors that recorded net foreign inflows last week were industrial products and services (RM62.7 million) and transportation and logistics (RM36.2 million).
“The top three sectors that recorded the highest net foreign outflows were financial services (-RM344.3 million), healthcare (-RM239.1 million) and utilities (-RM210.2 million),” it said.
The report, however, said that local institutions extended their net buying streak to two consecutive weeks, registering purchases of RM1.03 billion, 3.9 times higher than the previous week’s inflow of RM263.7 million.
“Meanwhile, local retailers continued their net buying activities, extending to a fifth consecutive streak of purchases, posting a net inflow of RM105.5 million,” it said.
MBSB said the average daily trading volume experienced a broad-based decline last week, with foreign investors and local retailers recording a decline of 6.6% and 6.1% respectively, while local institutions saw an increase of 4.8%.
Source: theedgemalaysia