Malaysia attracts most inflows

Foreign investors continued to favour Malaysian stocks last week when the US Dow Jones average hit a record high, boosting appetite for risk assets globally.

Malaysia’s bourse took in US$361 million in net foreign purchases in the week ended March 8, more than any of its Southeast Asian rivals, stock exchange data showed.

It posted a net US$1.8 billion in inflows in the year-to-date, trailing Indonesia’s US$2.1 billion but ahead of others.

Kuala Lumpur’s Composite Index has fallen 2.2 per cent so far in 2013, Asia’s worst performer.

Domestic investors were net sellers of the market due to caution ahead of a general election due to be held by mid-year.

Citi Research analysts wrote in a note dated March 8 that market reaction to the upcoming election was likely to be less severe than in the general election in 2008, when the market fell on the first day post election.

"Year-to-date, Malaysia is the worst-performing equities market in Asia Pacific excluding Japan, suggesting pricing-in of election risks... The market could remain listless in the short-term as investors await clarity on political leadership," the broker said.-- Reuters