Mumbai, September 13 (Daily Kiran) : Foreign portfolio investors (FPIs) have withdrawn ₹14,474 crores from the Indian equity market from September 1 to 12. This marks a significant shift after positive inflows in July and August.
Despite the sell-off in equities, FPI investments in the primary market remain positive at ₹1,336 crores, bringing the total for the year to ₹47,183 crores.
Throughout the past week, Indian equity markets faced considerable pressure, with the Nifty 50 index recording declines for the fifth consecutive week. Rising tensions in the Middle East have led to an increase in crude oil prices, raising concerns about inflation, global interest rates, and overall economic growth. This environment has triggered widespread selling, causing major sectors to close lower.
Market analysts indicate that high crude oil prices pose a significant challenge for domestic equities. Foreign institutional investors have maintained a cautious stance, significantly impacting domestic equity performance through ongoing sell-offs.
In contrast, domestic institutional investors (DIIs) managed to offset some of the foreign selling by making net purchases of ₹6,419.46 crores last week, helping to stabilize the domestic market.
Looking ahead, FPI investments are likely to be influenced by the escalating tensions between Iran and the U.S., which could further affect crude oil prices. Analysts warn that high oil prices and rising inflation may lead to tighter monetary policies, resulting in increased bond yields.
In the coming weeks, fluctuations in the Indian equity market are anticipated due to global macroeconomic and geopolitical risks. Key factors influencing market sentiment will include oil prices, developments in the Middle East, and changing expectations surrounding U.S. monetary policy.
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