According to depository data, FPIs have withdrawn Rs 35,137 crore from Indian equities between May 2 and 20.
FPI: The process of withdrawal of Foreign Portfolio Investors (FPIs) from the Indian stock markets continues. FPIs have pulled out more than Rs 35,000 crore from Indian markets so far this month. FPIs continue to be sellers in the Indian market due to aggressively increasing interest rates by the US central bank and strengthening of the dollar. According to depository data, FPIs have withdrawn Rs 35,137 crore from Indian equities between May 2 and 20. FPIs have so far withdrawn Rs 1.65 lakh crore from Indian markets in 2022.
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- Kotak Securities Head Equity Research (Retail) Shrikant Chauhan said that due to higher crude oil prices, inflation, tight monetary stance and other factors, the FPI’s trend will remain volatile.
- VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said, “As there is weakness in the major market US and dollar is strengthening, the sell-off by FPIs will continue.”
- Morningstar India associate director-manager research Himanshu Srivastava said foreign investors are worried about the possibility of a more aggressive rate hike by the US central bank going forward. The Federal Reserve has raised interest rates twice this year.
- Apart from equities, FPIs have pulled out a net Rs 6,133 crore from the debt or bond market during this period. Apart from India, FPIs have also withdrawn from other emerging markets such as Taiwan, South Korea, Indonesia and the Philippines.
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Foreign investors sold for 7 consecutive months
Foreign investors have been net sellers in the Indian market for seven consecutive months till April 2022. During this, he has made a net withdrawal of more than Rs 1.65 lakh crore. FPIs, however, had invested Rs 7,707 crore in shares in the first week of April after selling for six consecutive months. But after that, he once again became a seller in the week of short trading session from April 11 to 13. The same trend continues in the coming weeks as well.