FPI Outflow: Foreign investors sold shares worth Rs 22047 crore in May so far, invested Rs 2009 crore in the bond market

Due to uncertainty about the results of the Lok Sabha elections and the better performance of the Chinese markets, foreign investors i.e. FPIs have sold shares worth Rs 22,000 crore so far in May. Earlier, amid concerns about changes in India’s tax treaty with Mauritius and the continued rise in bond yields in the US, FPIs had withdrawn more than Rs 8,700 crore from shares in April. At the same time, FPIs made a net investment of Rs 35,098 crore in shares in March and Rs 1,539 crore in February. Overall, this year FPIs have withdrawn Rs 19,824 crore from shares. In the coming days, as things become clear about the results of the general elections, FPI buying in the Indian market will increase.

According to the depository data, foreign portfolio investors have withdrawn a net Rs 22,047 crore from shares till May 24 this month. Apart from Indian shares, FPIs have invested Rs 2,009 crore in the debt market i.e. bond market during this period. Earlier, FPIs had invested Rs 13,602 crore in the bond market in March, Rs 22,419 crore in February and Rs 19,836 crore in January. This year, FPIs have so far invested Rs 46,917 crore in the bond market.

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What do experts say

VK Vijaykumar, Chief Investment Strategist of Geojit Financial Services, says that the buying spree by FPIs may start even before the election results. He has said that the reason for the heavy selling by FPIs is the better performance of the Chinese stock market. VK Vijaykumar said that apart from this, FPIs are also selling due to the general elections in India.

Himanshu Srivastava, Associate Director-Manager Research, Morningstar India, said, “Amid the uncertainty over the results of the general elections, foreign investors are currently shying away from entering the Indian stock markets. They are waiting for the election results for this.