PARLIAMENT | Finance Minister Lim Guan Eng has dismissed MIDF Amanah Investment Bank's assessment that last week's market selldown was due in part to the government terminating the MMC-Gamuda joint venture contract for the underground portion of the MRT2 project.

Ahmad Maslan (BN-Pontian) had cited the report during question time, seeking an answer from Lim on why the market declined.

Lim, however, insisted that the market was mostly influenced by external factors.

"Stocks declined not because of one or two companies or projects, it doesn't have a big effect.

"I think not only in Malaysia, but stock markets worldwide are being influenced by economic developments in the US, especially the US' trade war with the world, particularly China," Lim told the Dewan Rakyat today.

Last week, foreign funds dumped RM1.05 billion in local stocks, with MIDF noting the quick pace at which it occurred.

MIDF in its research note on Monday said: “Last Monday’s foreign net selling of RM227.2 million was of no surprise as investors reacted towards last Sunday’s announcement of the termination of MMC Corp Bhd-Gamuda Bhd’s joint-venture underground work contract for the MRT2.”

On the same day that Bursa Malaysia dipped, the US Dow Jones fell 831 points in its worst performance in eight months.

Earlier Lim noted that other factors which affected local market sentiment were the hike in US Treasury yields, market uncertainty in Europe due to Italy's massive deficit budget and stalled Brexit negotiations, as well as pressure on the crude oil market due to strained US-Saudi Arabia ties over the disappearance of journalist Jamal Khashoggi.

Lim, however, noted that the outflow of foreign funds in Malaysia last week was among the lowest in the region at US$253 million.

Comparatively, he said Thailand had lost US$701.7 million.

Meanwhile, total foreign fund outflows in Malaysia were US$3.035 billion; Thailand US$4.634 billion; Indonesia US$1.441 billion; and Philippines US$850.4 million.