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FPI is Back: ‘U Turn’ of foreign investors after 9 months, will the stock market go green? Know what experts say

Photo:FILE FPI back in stock market

Highlights

  • The attitude of foreign investors seems to be changing now after 9 months
  • Foreign Portfolio Investors (FPIs) have finally taken a U turn
  • FPIs have bought shares worth Rs 1100 crore in the month of July

FPI is Back: The attitude of foreign investors, who have been the main reason for the decline in Indian markets, seems to be changing now. Foreign portfolio investors (FPIs), who have been selling for the last 9 months, have finally taken a U-turn. In the month of July, FPIs have bought shares worth Rs 1100 crore, putting the brakes on the sell-off. In such a situation, like last week, the greenery of Sawan can be seen in the stock market.

Earlier in June, FPIs had sold shares worth Rs 50,145 crore. This is the highest selling figure for FPIs in a single month since March 2020. At that time, FPIs had withdrawn Rs 61,973 crore from the shares. In October, 2021 i.e. for the last nine consecutive months, FPIs were withdrawing from the Indian stock markets.

Shrikant Chauhan, Head of Equity Research, Kotak Securities said, “FPI inflows will remain volatile for now due to rising inflation and tightening monetary stance.” 1,099 crore in net. Chouhan said that this month the indiscriminate selling of FPIs has not only stopped, but on some days of the month they are pure buyers.

Himanshu Srivastava, Associate Director-Manager Research, Morningstar India, said another major reason for FPI buying is that he believes that the US central bank will not hike interest rates as aggressively as was being projected in the upcoming meeting. was. This has also softened the dollar index, which bodes well for emerging markets. He said that the possibility of recession in America has also reduced. Apart from this, the recent ‘correction’ in the market has also increased the buying opportunities.

Echoing similar views, TradeSmart Chairman Vijay Singhania said weak US economic data has raised hopes that the Federal Reserve will not hike interest rates aggressively. Apart from this, the quarterly results of the companies have been better than expected. This has also increased investor confidence. So far this year, FPIs have withdrawn Rs 2.16 lakh crore from shares. This is the highest level of FPI outflows in any one year.

Earlier in the year 2008, he had withdrawn Rs 52,987 crore. Apart from equities, FPIs have infused a net Rs 792 crore into the debt or bond market during the period under review.

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Shivam Bangwal

Shivam Bangwal is an Indian based entrepreneur who is a tech, travel and coding enthusiast with a post graduation degree on Master's of Computer Applications. He is a founder of Youthistaan, People News Chronicle, Hitchhike TV, Branding Panther and many more.
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