MARKET UPDATES FPI: After infusing money into the Indian share market for the last two months, Foreign Portfolio Investors (FPI) turned into sellers in September and pulled out over Rs 7,600 crore.
This was because the US Federal Reserve took a "hawkish" stance and the rupee fell sharply in value. With this, data from depositories showed that FPIs have taken a total of Rs 1.68 lakh crore out of the Indian stock market so far in 2022.
Experts say that FPI flows will stay unstable in the coming months because of a number of global and domestic factors. Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities, said, "The UK government's expansionary fiscal policies at a time of high global inflation shook up the global currency markets and made people less willing to take risks in stocks." On the home front, he said, there are some worries about fuel prices and a small drop in GDP estimates. The data show that FPIs sold stocks worth a total of Rs 7,624 crore in September.
This happened after net investments of Rs 51,200 crore and nearly Rs 5,000 crore in August and July, respectively. Before that, starting in October 2021, FPIs were net sellers in Indian equity markets for nine months in a row. Even though FPIs had a good start to September, net flows were slower than in August because there was more uncertainty around the world.
Also, the US Fed raised interest rates by 75 basis points (bps) for the third time in a row last month to control inflation, and hints of more aggressive rate hikes have made investors less willing to take risks. This has also made people worry about the growth of the world economy and fueled fears that the US economy will go into a recession.
FPIs infuse Rs.8,600 cr in equity in September