Foreign investors have pulled out more than Rs 5,500 crore from capital markets this month so far due to global trade war worries coupled with hawkish commentary by the US Federal Reserve. This comes following a net outflow of over Rs 45,000 crore from capital markets (equity and debt) in the last two months. Prior to that, foreign portfolio investors (FPIs) had pumped in Rs 2,600 crore in March.
According to latest data available with depositories, FPIs withdrew a net sum of Rs 831 crore from equities and a net amount of Rs 4,683 crore from debt markets during June 1-15, resulting in a total outflow of Rs 5,514 crore.
“Investors were concerned as it was reported that the US President Donald Trump approved tariffs on about USD 50 billion of Chinese goods,” said Abhijeet Dey, Senior Fund Manager – Equities at BNP Paribas Mutual Fund.
“Further, the sentiments were dampened due to rate hike and the hawkish commentary by the US Federal Reserve,” said Jayant Manglik President at Religare Broking Ltd.
“We believe one should remain cautious in the market due to global sentiments, movement of Indian Rupee against the US dollar and crude oil prices,” he added.