Foreign Investors Continued Selling For Sixth Consecutive Month

Foreign investors continued selling for the sixth consecutive month, pulled out Rs 45,608 crore from Indian markets.

Foreign investors continued their sell-off for the sixth consecutive month, with a net withdrawal of Rs 45,608 crore from the Indian markets so far in March.

VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said foreign portfolio investors (FPIs) fear that India will be more affected by the hike in commodity prices.

This will be particularly affected by crude oil prices as India is its major importer.

According to depository data, FPIs pulled out Rs 41,168 crore from equities, Rs 4,431 crore from the debt segment, and Rs 9 crore from hybrid instruments, taking the total net outflow to Rs 45,608 crore between March 2-11.

Foreign investors continued selling: This is the sixth consecutive month of FPI outflows from the Indian markets.

Vijayakumar said the sales are mainly confined to the financial and IT sectors as these segments have huge assets of FPIs.

He said, “An important point of selling FPIs is that it is not affecting all the segments. For example, FPIs sold IT stocks worth Rs 10,984 crore in February, but in March IT was the best performer. One of those areas.”

Nimish Shah, Chief Investment Officer, Listed Investments, Waterfield Advisors, said that the dollar has strengthened since August-September 2021 and interest rates in the US have now gone up.

He added that the geopolitical crisis has also changed market flows and pushed sentiment from risk-taking to risk-averse, resulting in withdrawals from most emerging market economies.

Shrikant Chauhan, Head-Equity Research (Retail), Kotak Securities said that apart from Thailand, all other emerging markets have seen outflows so far in March.

“Taiwan, South Korea, Indonesia, and the Philippines witnessed FPI outflows of US$ 7,089 million, US$ 2,665 million, US$ 426 million, and US$ 26 million respectively.”

Thailand, on the other hand, saw an investment of US$ 102 million.