New Delhi: Due to high interest rates in the US, recession fears and high valuations of domestic stocks, foreign portfolio investors (FPIs) have pulled out more than Rs 10,000 crore from Indian stock markets in the first three weeks of September (September 22). Earlier, FPIs had been net buyers of Indian stocks for six consecutive months from March to August. During this period he had bought shares worth Rs 1.74 lakh crore.
“As valuations are still high and bond yields in the US (4.49 per cent for 10 years) remain attractive, FPIs remain sellers,” said VK Vijayakumar, chief investment strategist at Geojit Financial Services. According to depository data, foreign portfolio investors have been net sellers in 11 out of 15 trading days so far this month and have pulled out a net Rs 10,164 crore from stocks.
Earlier in August, FPI inflow into shares had fallen to a four-month low of Rs 12,262 crore. Himanshu Srivastava, Associate Director – Manager Research, Morningstar India, said, “The flow of FPI investment has been sluggish for the last few weeks. The main reason behind their hesitation is concerns about inflation and uncertainty about the interest rate scenario, especially in the US, and global economic growth.
According to the data, FPIs have infused Rs 295 crore in the debt or bond market during the period under review. Thus, in the current calendar year so far, FPI investment in shares has been Rs 1.25 lakh crore. At the same time, he has invested more than Rs 28,476 crore in the bond market.