FPIs remained net sellers in November in terms of valuations in the expensive segment

Foreign portfolio investors (FPIs) were net sellers of Rs 949 crore in the domestic markets in the first half of November.

He pulled out Rs 4,694 crore from equities between November 1-12, according to depository data.

At the same time, he invested Rs 3,745 crore in the debt segment.

This resulted in a total net withdrawal of Rs 949 crore.

FPIs were net sellers of Rs 12,437 crore in October.

Morningstar India Associate Director-Manager Research Himanshu Srivastava said FPIs are concerned about high valuations of Indian equities, which are trading close to all-time highs.

Additionally, concerns over global inflationary pressures and slowdown in some developed economies are also a cause for concern, he added.

He added that profit-seeking FPIs may have chosen to book only which is reflected in the trend of inflows over the past few weeks.

“It appears that FPIs are exiting over valuation concerns. The important point to note is that the old scenario where FPIs representing smart money represent market trends is over for the present… we are in an era of uncertainty,” said VK, Chief Investment Strategist, Geojit Financial Services Vijaykumar said.

For the debt segment, Srivastava said, “The flow trend is largely driven by the direction of the dollar and the US Treasury yield. When they take a wait-and-see approach to Indian equities, FPIs park their investments in Indian bonds for the short term. ,

Shrikant Chauhan, Head of Equity Research Retail, said FPI inflows in November were positive for Indonesia, Philippines, South Korea, Taiwan and Thailand for $78 million, $47 million, $203 million, $1,565 million and $59 million respectively. Kotak Securities.

Going ahead, Chouhan said FPI flows to emerging markets may remain volatile due to sharp rise in global energy prices and prospects of higher prices may become another source of risk to global and domestic inflation.

(with PTI inputs)