Amidst the rapidly changing global developments, foreign investors have started leaving the Indian market. During the month of September, FPI made a new record of selling. This is the first time after six months that foreign investors have become net sellers in the Indian market. In such a situation, there may be pressure on the domestic stock market in the coming days.
So much selling on net basis in September
Depository data shows that in the month of September, FPIs sold Indian… Made a net sale of Rs 14,767 crore (about $ 1.7 billion) in equities. This is the first time since February 2023 that FPIs have made net selling in any month. Net selling means that during the period under review, FPIs withdrew more money than they invested.
Big investments came in the previous 6 months
Indian Market China And it is the third largest equity market in Asia after Japan. For this reason the Indian market has become important for FPIs. Due to geopolitical reasons, FPIs are becoming disillusioned with the Chinese market. In such a situation, the Indian market became the natural choice for those foreign investors who were currently exiting the Chinese market. This is the reason why FPIs had invested more than $20 billion in the Indian market in the six months from March to August 2023.
Buying-selling ratio fell below 1
September The buying versus selling ratio of FPIs in the Indian equity market declined to 0.95 during the month. In the long term this ratio is 1.07. A buying versus selling ratio of less than 1 means that FPIs are selling more than buying. Similarly, a ratio of more than 1 indicates that they are buying more and selling less.
This record of sales was made in September
If we look at the figures of last month, the gross On this basis, FPI made a new record of selling. NSDL data shows that in the month of September, FPIs made gross sales of equity worth Rs 2.76 lakh crore. This is the largest figure of gross sales in any one month since the data of buying and selling of FPIs is available with NSDL.
FPIs sold due to these reasons
Many reasons are being held responsible for this changed trend of FPI. Crude oil is showing continuous rise. Brent crude has come close to touching the level of $ 100 per barrel. Due to this, crude oil has become a good option for investors. On the other hand, due to the rise in dollar, FPIs are getting good options for investment. The changed stance of the US Central Bank Federal Reserve is also increasing pressure on emerging markets like India.
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