FPIs snap buying streak to turn net sellers, offload ₹13,047 crore in Indian equities: What led to trend reversal?
₹13,047 crore worth of Indian equities and the total inflow stands at ₹134 crore as of January 19, taking into account debt, hybrid, debt-VRR, and equities, according to National Securities Depository Ltd (NSDL) data. FPIs were big players in financial services and information technology (IT), according to analysts. "There is a sudden change in the strategy of the FPIs starting 17th January.
They turned massive sellers in the cash market having sold equity worth ₹24,147 crores in three days from 17th through 19th January,'' said Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services. FPIs snapped their buying streak over global cues as the US bond yields rose from 3.9 per cent to 4.15 per cent, triggering capital outflows from emerging markets such as India, according to market experts.
Also Read: HDFC Bank ADR falls over 9% overnight; tanks 15% in 2 days after Q3 results
‘’It is important to understand that FPIs were big sellers in other emerging markets too like Taiwan, South Korea and Hongkong. Also, since the valuations in India are high, FPIs used the excuse of less-than-expected results from HDFC Bank to press massive sales. FPIs increased their short positions, too,'' said Dr.
V K Vijayakumar. HDFC Bank, the heaviest-weighted stock on the indexes, tumbled 8.44 per cent a day after reporting its October-December quarter results - in its biggest one-day slide since May 2020, on worries over its stagnant margins. The market capitalisation of the stock dropped by nearly over a lakh crore in a single day to ₹11.7 lakh crore.
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