FPIs pull out over Rs13,000-cr from equities, invest Rs15,647-cr in debt

Foreign portfolio investors (FPIs) pulled out a net Rs13,047 crore from Indian equities in three days ended 19 January 2024, even as total withdrawals from the equity market in three consecutive sessions starting 17 January stood at over Rs24,000 crore. 

At the same time, FPI flows into the debt securities saw an uptick, with investors injecting Rs15,647 crore into the debt market, stock market data showed.

Capital outflows form the Indian market hammered stocks like HDFC Bank, following large-scale offloading by foreign investors.

FPIs have been cautious in their investment in the equity market with market indices at all-time high. While they have been booking profits all the way, the disappointing quarterly results of HDFC Bank seems to have acted as a trigger for divestment.

The selloff, however, affected stock market sentiment. The key BSE Sensex plummeted 1,628 points on Wednesday, followed by another 313.90 points decline on Thursday.

Domestic institutional investors bought stocks worth Rs9,900 crore in the last two days but it was not enough to prevent the slide in the market.

Despite the shifting of investment from equity to debt, overall, foreign investors seemed to be bullish on the Indian market. FPIs were banking on a possible rate cut by the Reserve Bank of India and a potential demand revival in the IT sector.

FPIs have invested a total of Rs1.71 lakh crore in equities and Rs68,663 crore in debt, injecting about Rs2.4 lakh crore in Indian markets so far in the year 2023, according to stock market data.