Foreign appetite for emerging markets including Malaysia is expected to remain strong for the remainder of the year as investors are looking to diversify funds in light of the widening risk-reward ratio on Wall Street as another Federal Reserve rate hike looms.
According to Rakuten Trade head of research Kenny Yee, the net inflow recorded, particularly in Southeast Asian countries such as Malaysia and Indonesia, in the last few weeks shows that profit-seeking investors are leveraging the low valuation in stocks in these countries to subsequently gain exposure to the region’s high-growth markets.
Foreign investors continued to net buy on Bursa Malaysia at RM550.9 million a week ago, which was the highest net foreign inflow over the past eight weeks. Indonesia recorded a net foreign fund inflow of US$110.6 million (RM518.77 million) last week, ending six straight weeks of net outflows.
Fidelity Emerging Markets Limited (LON:FEML) is an investment trust that aims to achieve long-term capital growth from an actively managed portfolio made up primarily of securities and financial instruments providing exposure to emerging markets companies, both listed and unlisted.
