Curated By: Business Desk
Last Updated: September 18, 2023, 13:18 IST
In the starting two weeks of September, foreign portfolio investors (FPIs) withdrew approximately Rs 4,800 crore from Indian stock markets due to increasing US bond yields, a robust dollar, and concerns about economic growth. Previously, FPIs had been consistently purchasing Indian shares for six consecutive months, spanning from March to August. During this period, they had accumulated shares valued at Rs 1.74 lakh crore.
V K Vijayakumar, the Chief Investment Strategist at Geojit Financial Services, suggests that foreign portfolio investors (FPIs) may continue their selling trend in the days ahead due to the profitable valuations. He highlights that the present American 10-year bond yield stands at 4.28 per cent, and the dollar index has surged beyond the 105 threshold. Given these conditions, FPIs might lean towards additional divestment.
As per depository data, foreign portfolio investors (FPIs) have pulled out a net amount of Rs 4,768 crore from Indian shares up to September 15. In August, FPI inflows into the stock market had dwindled to a four-month low of Rs 12,262 crore.
Himanshu Srivastava, Associate Director – Manager Research at Morningstar India, attributed FPIs’ net selling trend in September to uncertainties regarding the global interest rate scenario, particularly in the United States, along with apprehensions regarding worldwide economic growth. The data also indicates that FPIs have infused Rs 2,000 crore into the debt or bond market during the same period.
Notably, the investment in Indian shares has soared to Rs 1.3 lakh crore while they have allocated over Rs 30,200 crore to the bond market.
Nine out of 10 companies in the Sensex witnessed an increase of Rs 1,80,788.99 crore since last week. Tata Consultancy Services (TCS) among the companies gained significant profits. During the week, the 30-share BSE Sensex recorded an impressive rise of 1,239.72 points, equivalent to 1.86 per cent. Notably, the Sensex concluded the trading week with gains for the 11th consecutive session. Throughout this week, all but one of the top 10 companies, Hindustan Unilever, benefitted.