After turning net sellers in January, foreign portfolio investors remained net sellers during the first fortnight in February, offloading Indian equities worth Rs 3,776 crore. With this, the net outflows in 2024 have risen to Rs 29,520 crore.
The FPIs bought shares worth Rs 138 crore on Friday. In January, they sold shares worth Rs 25,744 crore.
Attributing the selling trends to the spike in US bond yields, expert V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services said that bond yields rose on higher-than-expected consumer price inflation which led to sustained selling by FPIs in the cash market.
In February through 16th, FPIs had sold equity worth Rs 6,112 crore through the exchange but buying through the primary market and others reduced the net selling figure to Rs 3,776 crore.
Vijayakumar says the trend of FPI selling is likely to continue so long as the US bond yields remain elevated. However, the sustained FPI buying in debt which started early this year will also likely continue, he added.
The selling by FPIs in equity would have been much higher in response to the rising US bond yields but FPIs have been showing restraint amid robust buying action from the domestic institutional investors (DIIs), the Geojit analyst said. He said that for this reason, FPIs have refrained from aggressive selling as they “will have to buy the same stocks later, which they have been selling” when conditions become favourable for buying.
Indian benchmark indices extended their winning momentum to the fourth session in a row on Froday helped by strong buying action in auto and IT stocks. While the S&P BSE Sensex settled at 72,426.64, up by 376.26 points or 0.52%, the broader Nifty 50 finished at 22,040.70, higher by 129.95 points or 0.59%.
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