FPIs' exodus continues; pull out Rs 46,000 crore from Indian equities in June so far

The net outflow by foreign portfolio investors from equities reached Rs 2.13 lakh crore unitll now in 2022, data with depositories showed.

Foreign investors continue to desert Indian equity markets and pulled out close to Rs 46,000 crore so far this month following monetary policy tightening by the Reserve Bank and US Federal Reserve, high oil prices and volatile rupee.

The net outflow by foreign portfolio investors (FPIs) from equities reached Rs 2.13 lakh crore unitll now in 2022, data with depositories showed.

Given the policy normalisation narrative by the US Fed and other major central banks, coupled with high oil prices and volatile Rupee, FPIs are likely to stay away from emerging market assets, Hitesh Jain, Lead Analyst - Institutional Equities, Yes Securities, said.

FPIs inflow will only resume once there is visibility on the peak of bond yields in the US and an end to Fed rate hikes, he added.

Moreover, FPIs are likely to sell more if the current trend of rising dollar and bond yields persists, said VK Vijayakumar, Cheif Investment Strategist at Geojit Financial Services.

According to the data, foreign investors withdrew a net amount of Rs 45,841 crore from equities in June (till 24th).

The massive selling by FPIs continued in June as they have been relentlessly withdrawing money from Indian equities since October 2021.