FPI Investment: Foreign investors started leaving the Indian market, why is the FPI trend reversing in the new year?

FPI Investment: Foreign investors started leaving the Indian market, why is the FPI trend reversing in the new year?

A change is being seen in the attitude of foreign investors in the Indian market. Foreign portfolio investors, who had been buying heavily for the last few months, have now started selling. The attitude of foreign investors seems to be changing in the second week of the new year.

So much selling in the last week

According to market data, during the week ending January 12, FPI sold 2,477 Made net sale of Indian equities worth Rs. crore. Earlier, foreign portfolio investors were continuously buying. During the first week of the year 2024 i.e. the week ending January 5, FPIs had made a net purchase of shares worth Rs 4,436.05 crore. FPIs were net buyers in the month of December also.

Domestic market at new heights

However, even after last week's selling by FPIs, the domestic stock market was successful in reaching new heights. During the last week, Sensex and Nifty jumped by about 1 percent each and both the major domestic indices reached their new lifetime high. On Friday, the BSE Sensex closed after crossing 72,500 points, while the Nifty 50 index was successful in crossing 21,900 points.

This history was made last year

Last year the FPI investment In that respect it proved historic. During the year 2023, FPIs had purchased Indian shares worth Rs 1.77 lakh crore, which is the largest figure in any single year. One third of the total investment in the entire year had come in the month of December alone. In this way, the month of December was the biggest month of 2023 in terms of FPI investment.

There is good hope for the future

The biggest reason for the selling of FPIs is the interest rate increase in America. There is uncertainty regarding. Due to the rise in inflation in America once again, the possibility of reducing interest rates has weakened. In such a situation, FPIs sold in emerging markets. However, if we talk about the coming days, the prospect seems good. Interest rates are bound to come down sooner or later in 2024, in such a situation FPI buying may increase.

Also read: The lowest target in seven years, yet the government remained miles behind, now this plan on disinvestment can come in the budget!

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