Foreign investors pull out Rs9,300 cr in first 5 days of October

Foreign investors have pulled out over Rs9,300 crore from the Indian capital markets in the last four trading sessions, hammering a rupee already hit by rising crude oil and rising dollar, further.

Between 1 and 5 October, foreign portfolio investors withdrew a net Rs7,094 crore from equities and Rs2,261 crore from the debt market, which adds up to a total Rs9,355 crore, according to depository data,
This is on top of over Rs21,000 crore from the capital markets (both equity and debt) last month. Prior to that, they had put in a net amount of Rs7,400 crore during July-August.
While FPIs have been net sellers almost throughout the year since January, the October offloading has been the fastest.
Experts say profiteering from secondary markets is a global phenomena, especially in emerging markets , it is more particular to India where FPIs come in droves and sell off in unison causing ups and downs in the market as the enjoy the cream.
They also indicate the financial market mayhem caused by the defaults by IL&FS group, the firming up of the dollar and rising oil price, the recent spate of management-related issues in banks and tightening liquidity in NBFCs as immediate triggers, it also is equally true that FPI remain the major source of market volatility in India.
So far this year, FPIs have pulled out over Rs 20,000 crore from equities and more than Rs 50,000 crore from the debt market.
The latest withdrawal comes following a net outflow of over Rs21,000 crore from the capital markets (both equity and debt) last month. Prior to that, they had put in a net Rs7,400 crore in July-August.