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    FPIs pull out Rs 8,319 crore in August amid persisting negative sentiment

    Synopsis

    However, FPIs invested a net Rs 2,096.38 crore in the debt securities during the period.

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    In July, FPIs had withdrawn a net sum of Rs 2,985.88 crore from the Indian capital markets (both equity and debt).
    New Delhi: Foreign investors pulled out Rs 8,319 crore on a net basis from capital markets in the first half of August, continuing their selling spree in the Indian market amid uncertainty over FPI tax and global trade worries.

    According to the depository data, foreign portfolio investors (FPIs) sold equities worth Rs 10,416.25 crore on a net basis during August 1-16 period.

    FPIs, however, invested a net Rs 2,096.38 crore in the debt securities during the period.

    So far in August, FPIs have been net sellers for nine out of 10 trading sessions, indicating "extreme negative sentiment", Himanshu Srivastava, senior analyst manager research at Morningstar said.

    In July, FPIs had withdrawn a net sum of Rs 2,985.88 crore from the Indian capital markets (both equity and debt).

    "Prevailing uncertainty over the higher tax on FPI has negatively impacted foreign investors. They have been exiting Indian equities ever since the higher surcharge, or ‘super rich', tax was introduced in the budget announced on July 5th," Srivastava added.

    Besides, a mix of unconducive domestic and global factors have also contributed towards this exodus of foreign funds from the Indian equity markets in July as well as in August. While there has been a marked slowdown in India's economic activity, a sub-par monsoon and weak earning season have made matters worse.

    Experts opined that the ongoing tension between the US and Iran and the continued trade war between the US and China have also impacted the investor sentiment.
    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds.)

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    2 Comments on this Story

    Raj409 days ago
    Need a Dynamic, and a knowledgable economist as FM, as PM can find one of such gem from within or outside to save the economy who can take advantage of the present situation around the world. When the whole world is using Indian specialist why not PM who has such a mandate?
    Solomon Coutinho410 days ago
    Thank you FM... For the damage to my country with your stupid decisions... And you are still discussing on it... Keep it up... By the way, who awarded the economic degree to you... Just a degree is worthless if you have no actual experience of implementing what you learned.
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