Why did FPIs intensify selling in Indian equities?

FPIs intensified selling due to the rupee's continuous depreciation and concerns about potential widening trade deficits, exacerbated by trade uncertainties.

What was the impact of FPI selling on Indian markets?

The intensified FPI selling led to a 2.51% decline in the Nifty and a 2.4% drop in the Sensex, wiping out ₹16 lakh crore in market capitalization.

Who provided support to the Indian market during FPI outflows?

Domestic institutional investors (DIIs) provided critical support by pumping in ₹20,746 crore into the market during the week.

Home / Business and Economy / FPIs Flee India: Equity Outflow Hits ₹11k Crore

FPIs Flee India: Equity Outflow Hits ₹11k Crore

24 Jan

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Summary

Foreign investors sold net ₹11,068.34 crore in Indian equities.
Rupee depreciation to ₹91.96 against the dollar is a key trigger.
Nifty fell 2.51% and Sensex dropped 2.4% amid the selling.

FPIs Flee India: Equity Outflow Hits ₹11k Crore

Foreign portfolio investors (FPIs) significantly increased their selling of Indian equities during the week ending January 23, with net outflows totaling ₹11,068.34 crore across five trading sessions. The relentless selling saw Monday recording the heaviest single-day outflow at ₹4,542.94 crore. This exodus was primarily triggered by the Indian rupee's persistent depreciation, which reached ₹91.96 against the dollar by Friday. Market participants anticipate that delays in the US-India trade agreement could further widen trade deficits, impacting the rupee negatively.

The intensified FPI selling directly impacted Indian stock markets, with the Nifty declining by 2.51% to close at 25,048 and the Sensex falling by 2.4% to settle at 81,537. This market correction led to a substantial loss of ₹16 lakh crore in overall market capitalization. Realty, consumer durables, and capital market stocks were particularly hard-hit, experiencing declines of 11.33%, 6.55%, and 6.50% respectively.