Foreign institutional investors (FIIs) has pulled out a record of about Rs 17,000 crore from Indian equity markets in August. After Tuesday’s sell-off, it looks like the markets set for more losses in the near future. The sources reveals that the muted private sector investments and declining exports, and foreign brokerages cutting their growth forecasts.
“Sentiment was downbeat in reaction to weak GDP data,” said Jayant Manglik, president, retail distribution, Religare Securities. Core sector output also slid to a three-month low of 1.1% in July. Adding to that, negativity on the global front pushed benchmarks lower as the day progressed.”
“Investment growth continues to be on a fragile footing, while consumption is starting to show some signs of a recovery,” Crisil Research said in a note.
According to the depository data sources, FPIs withdrew a net Rs 17,428 crore from the stock markets in August which also included Monday’s provisional figures.
The net outflow by foreign portfolio investors (FPIs) which is an all-time high since 1997 was followed a net investment of Rs 5,323 crore in the month of July.
During January to April, investments by Foreign Portfolio Investors (FPIs) totalled Rs. 94,241 crore, but month-on-month analysis shows the fund flows are witnessing a declining trend.
Foreign Investment Withdrew 17000 crores In August
FPI investments in January this year stood at Rs. 33,688 crore, before dropping to Rs. 24,564 crore (February), Rs. 20,723 crore (March) and Rs. 15,266 crore (April).
Things got worse in May as FPIs have withdrawn an estimated Rs. 16,723 crore ($2.6 billion) so far this month, according to the latest data from depositories.
This included an outflow of Rs. 7,635 crore from the equities and another Rs. 9,088 crore from the debt market.