IGI Logo

Below is quote on FPI By Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services

The massive FPI selling in Indian markets impacted market sentiments. FPIs sold in the cash market a mammoth Rs 53887 crores in January and followed up this with Rs 3212 crores of selling in February so far. FPIs are selling in India and buying in cheaper markets like China, Hong Kong and South Korea where valuations are attractive. This “short India and long other cheaper markets” strategy has led to big underperformance of the Indian market, so far this year. While China, Hong Kong and South Korea are up by 4.71 %, 7.52 % and 11.45% respectively YTD India is down by 1.89%. This kind of underperformance is unlikely to last long. FIIs have also been hugely short in the derivatives market. The Budget turned out to be far better than expected. But the market couldn’t hold on to the gains since the Adani stock crisis impacted sentiments. Banking stocks were impacted on fears of Adani exposure impacting banks. But the RBI message that the Indian banking system is healthy improved sentiments leading to a late rally in banking stocks.

Above views are of the author and not of the website kindly read disclaimer