KUALA LUMPUR, 1 December 2025 — Foreign investors on the Malaysian equity market recorded net outflows for the second consecutive week, extending pressure on the market amid uncertain risk sentiment and modest year-to-date (YTD) outflow levels. Data from CIMB Securities show that YTD foreign outflows into Malaysian equities have now surpassed RM20.27 billion.
For the week ended 27 November 2025, foreign investors posted net selling of approximately RM484.9 million, representing a decline of about 53.1% week-on-week, indicating some moderation in selling pressure.
Domestic Investors Step In
Despite foreign exits, local institutional investors remained net buyers, registering net inflows of around RM267.0 million for the week, helping lift their YTD net inflows to RM18.2 billion. Retail investors likewise extended their net-buying streak into a second week, purchasing approximately RM128.3 million, bringing their YTD cumulative net buy position to RM568.5 million.
Sectoral Flows Provide Nuanced View
Foreign net selling was particularly concentrated in the industrial products sector (~RM359 million), utilities (~RM321 million), and construction (~RM66 million). On the flip side, foreign buying was seen in financial services (~RM258 million), telecommunications (~RM151 million) and plantations (~RM74 million).
Implications for Investors
This continuation of foreign net outflow has several implications for Asian-investor portfolios and market positioning:
- The large YTD outflow suggests foreign investors remain cautious about the Malaysian market despite selective participation by locals.
- Local institutional and retail support may help stabilise valuations, but sustained foreign selling could weigh on sentiment and liquidity, particularly for large-cap and export-oriented stocks.
- Sector flows indicate that defensive or utility-type sectors are under pressure, while financials and telecoms are receiving foreign interest, signalling tactical tilting may be underway.
- For Asian investors evaluating Malaysia as part of a regional allocation, this trend underscores the importance of monitoring fund-flow dynamics alongside fundamentals and valuation.
Watch-Points Ahead
- Whether the foreign selling trend continues, slows down further or reverses (possibly triggered by global risk easing or domestic catalysts).
- Movement of the Malaysian ringgit: foreign fund flows often correlate with FX shifts and currency hedging pressures.
- Sector-specific drivers: For example, export performance, commodity pricing (for plantations/utilities), and domestic demand factors that may attract foreign capital back.
- Liquidity and breadth: Week-on-week trading volumes, ADTV (average-daily trading volume) across investor groups, and whether local buyers can offset foreign exits.
