FPIs Turning Net Buyers After Biggest Selling In Last 20 years
Against the overall trend, foreign investors have stayed positive in the primary market with net buying.
Mumbai : Foreign portfolio investors have sold equities worth Rs 1.60 lakh crore so far in 2025 against FPIs staying net buyers in 2024 by a humble amount of Rs 427 crore.
If the FPIs selling trend doesn't reverse in the remaining days of December, FPI selling in 2025 would be the highest in the last 20 years surpassing the 2022 figure of Rs 1,21,439 crore. But the good news is that for the past two sessions FPIs have turned net buyers which may keep domestic market participants for more confirmation towards FPIs future behaviour.
On Wednesday and Thursday FPIs were net buyers by Rs 1171.71 crore and Rs 595.78 crore respectively after being sellers in all previous days in December. On both days both FPIs and domestic institutions were net buyers though the market closed in the red.
December has seen higher selling pressure from FPIs and so far they have net sold equities worth over Rs 17,000 crore as per NSDL data.
A track record of FPIs in last 5 years shows they were net buyers in 2023 by over 1.71 lakh crore, in 2022 FPIs were net sellers by over Rs 1.21 lakh crore, in 2021 they were net buyers by 25,752 crore and in 2020 they had net invested over Rs 1.70 lakh crore.
Against the overall trend, foreign investors have stayed positive in the primary market with net buying.
In the secondary market however, they have been booking profit when the market has shown significant upward movement.
"An interesting takeaway from Wednesday's trade is that despite FPI buying and net institutional buying the market drifted down. The reason might be the FPIs increasing their short positions in the market. This means, in the near-term, FPIs will resort to a sell on rally strategy," said VK Vijayakumar, chief investment strategist, Geojit Investments.
"A concern in the market now is whether the Japanese central bank will raise the rates today with a hawkish message. If that happens, that might trigger a reversal of the ‘yen carry trade’ leading to further selling by FIIs," Vijayakumar said.
Meanwhile, on Thursday the Sensex closed at 84,481.81 down by 77.84 points or 0.09 per cent, Nifty-50 also drifted lower to 25,815.55 down by 3 points or 0.01 per cent. Broader market too closed flat with BSE Mid-cap index up 0.05 points and BSE Small-cap index down by 0.28 per cent. Volatility index India VIX fell 1.32 per cent to settle at 9.71 per cent very close to 52 week low of 9.40 indicating less volatile markets in near future.
