Russia-Ukraine War: Foreign Investors Pull Out Rs 17,000 Crore From Indian Market (Find Out Why?)
Foreign portfolio investors (FPIs) have pulled up to Rs 17,537 crore in Indian markets in just three trading installments in March as investors’ sentiments are fueled by uncertainty created by the Russian-Ukrainian conflict and rising crude oil prices.
Almost 17000 crore Pulled From Equities, Debt & Mixed Components
According to depository data, they pulled out Rs 14,721 crore from equities, Rs 2,808 crore for the debt component and Rs 9 crore for mixed instruments between March 2-4.
This took the total exit to Rs 17,537 crore. ” Market sentiment has exerted a powerful influence on globalization and the growing tide of war, ” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services. Other than that, they were traders in the debt category again, in the midst of a declining rupee.
According to Himanshu Srivastava, Coordinating Director – Research Manager, Morningstar India, the discrepancy in such a large country is not well reflected in emerging markets like India in terms of international flow. The high balance of Indian equity markets, the risk of corporate income and the slowdown in economic growth have made it difficult for foreign investors to invest heavily in Indian stock markets, he said.
Exit Rate Sharply Risen
”But the exit rate has risen sharply after the US Fed decided to withdraw its pressure and raise interest rates soon. Water leaks have increased significantly as a result of the war between Russia and Ukraine, ” he added.
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd, said, “FPI flowing into emerging markets in February 2022 was good, outside of India. Indonesia, the Philippines, Korea and Thailand have seen millions of dollars in revenue. 1,220 million, $ 141 million, $ 418 million and $ 1,931 million, respectively. ”
The FPI flow is expected to be volatile in the coming months, due to Russia’s ongoing attacks on Ukraine and its collapse in sanctions, high inflation and rising interest rates by the Fed, he said.