Foreign portfolio investors (FPIs) pulled out Rs 14,935 crore from the Indian markets in the first fortnight of February. This is the fourth consecutive month that FPIs have been sellers.
According to depository data, during February 1 to 11, FPIs have withdrawn Rs 10,080 crore from equities, Rs 4,830 crore from debt or bond market and Rs 24 crore through hybrid channels.
In this way their total withdrawal has been Rs 14,935 crore.
Himanshu Srivastava, Associate Director (Managerial Research), Morningstar India, said, “FPI selling has increased after the US central bank indicated that the easing monetary stance is giving up. Globally, bond yields have risen following indications that the US central bank will hike interest rates.
He said inflation in the US has reached a 40-year high. In such a situation, the US central bank may increase interest rates aggressively in the coming months. This may further increase the outflow of foreign funds from Indian stocks.
Shrikant Chauhan, Head of Equity Research (Retail), Kotak Securities said that the trend in emerging markets in February till date has been mixed.
He said that during this period, investment in Thailand, Indonesia, South Korea and the Philippines has been $1155 million, $58 million, $477 million and $133 million, respectively.
On the other hand, $ 410 million has been withdrawn from Taiwan during this period.
VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said, “FPIs will continue to sell in the coming days due to a weak trend in global markets and rising yields on 10-year bonds in the US.”