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

"An important trend in the institutional flows this month is the continuous selling by FIIs and the sustained buying by DIIs. But FIIs selling has declined recently and on Friday the 17th May, FIIs turned buyers. As on 17 May, FPI selling stood at Rs 28241crores as per NSDL data. In the cash market FII selling stood at Rs 35532 crores through 17th May. FII cash market selling was almost matched by DII buying of Rs 33973 crores during this period. The main trigger for the FII selling has been the outperformance of the Kong Kong index Hang Seng which shot up by 19.33% during the last one month. FIIs are moving money from expensive markets like India to cheap markets like Hong Kong where the PE is around 10 compared to around 20 PE in India.

Uncertainty surrounding the election outcome also has contributed to heightened volatility in the Indian market. The recent spike in the fear gauge VIX indicates a high level of uncertainty in the market.
Another important trend is the stability in FII inflows into debt. So far for CY2024, while the equity market has witnessed FPI outflows of Rs 26019 crores, the debt market has witnessed inflows of Rs 45086 crores. Going forward, there is likely to be a dramatic change in FPI equity flows in response to election results. Political stability will attract huge inflows."

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