The inflow of foreign portfolio investors (FPIs) into the Indian market that was driven by Adani Group’s block deal in the early stages of March has been offset by fears of contagion from foreign banks. The collapse of Silicon Valley Bank and Signature Bank, as well as a liquidity crisis at other US and European lenders, dampened investor mood globally. Indian stock markets also had to bear the brunt of this. In the week between March 13 and March 17, the Sensex and the Nifty 50 declined by about 2% each. And this week’s selloff has reduced FPI inflows.
As per NSDL data, FPI keep inflow 11,495 crore in Indian equities in the current month so far, till March 18.
Earlier, FPI inflows in the week ending March 10 were 13,540 crore, NSDL data. it was caused by the mega block deal 15,446 crore in four Adani companies.
It is being said that the flow of FPI has come down 2,045 crore during the trading sessions from March 13 to 17.
home equity Banks started the week ended March 17 in the red due to contagion fears following the collapse of Silicon Valley Bank and Signature Bank, but some liquidity lifelines in the last two trading sessions helped lenders such as Credit Suisse and First Republic Bank. Was given Calmed the nervousness of selling. Also, better-than-expected inflation data contributed to lifting sentiment. However, persistent foreign fund outflows limited the gains.
Accordingly, the Sensex fell 1,145.23 points or 1.93% and the Nifty 50 fell 312.85 points or 1.8% this week.
Talking about the performance of FPIs, Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services said, “What is the total amount invested by FPIs? 11344 crores till 18th March. involves huge investment of 15446 cr by GQG in Adani’s shares. So FPI is negative in wholesale deals.”
Meanwhile, foreign institutional investors (FPIs) were net sellers during the latest week. they sold 7,953.68 crore from March 13 to 17.
Vijayakumar highlights that for 2023, so far FPIs have sold equities 23283 crore (NSDL). FPIs have been consistent buyers of capital goods only. In financial services, they have been alternating between buying and selling in different fortnights.
“As risk-off is now the dominant market mood following bank failures in the US and contagion fears, FPIs are unlikely to turn buyers in the near term,” he added.
Year-on-year, FPI flows into Indian equities stand still 22,651 crores.
Disclaimer: The views and recommendations given above are of individual analysts or broking companies and not of Mint. We advise investors to do due diligence with certified experts before making any investment decision.
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