Foreign Portfolio Investors (FPIs) have net sold Rs 17,083 crore of Indian equities in May so far,
Foreign Portfolio Investors (FPIs) have net sold Rs 17,083 crore of Indian equities in May so far, influenced by rising US bond yields and the outperformance of Chinese and Hong Kong markets. Data from the National Securities Depository Ltd (NSDL) reveals that FPIs purchased Rs 108,959 crore worth of equities and sold Rs 126,042 crore till May 10. In April, FPIs offloaded Rs 8,671 crore of domestic shares. The heavy selling by FPIs has contributed to a 2.6% decline in benchmark stock market indices, Sensex and Nifty 50, in the current month.
V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, notes that the aggressive FII selling is influenced by the outperformance of Chinese and Hong Kong markets compared to the Indian market. Chinese and Hong Kong markets are perceived as relatively cheaper with lower PEs (price to earnings) compared to India. As long as this outperformance persists, FIIs are likely to continue selling. The weakness in frontline financials is attributed primarily to FII selling.
Despite domestic institutional investors (DIIs) buying, they are not as aggressive, partly due to concerns surrounding election results. In the debt market, FPIs have net bought Rs 43,307 crore, and in the debt-VRR (Voluntary Retention Route), they purchased Rs 7,917 crore, as per NSDL data.
Originally posted 2024-05-11 07:27:00.
