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Foreign investors have withdrawn Rs 1.14 lakh crore from the Indian stock market in March, which is the biggest monthly selloff till date. There is still one trading session left in the month. Therefore, withdrawals may increase further. Earlier, the record for highest withdrawal in a month was Rs 94,017 crore in October, 2024. The reason for this is the increasing tension in Western Asia, weakening rupee and the impact of high crude oil prices on growth rate.
There was tremendous investment last month
With the recent withdrawal, the total outflow by foreign portfolio investors (FPIs) has reached Rs 1.27 lakh crore so far this year, according to NSDL data. FPIs continued selling in March and sold shares worth Rs 1.13 lakh crore in the cash market till March 27. This came after foreign investors invested Rs 22,615 crore in February, the highest monthly investment in the last 17 months.
Sales increased due to these reasons
Experts believe that there is continuous selling pressure due to global macroeconomic challenges and increasing geopolitical uncertainty. VK Vijayakumar, chief investment strategist at Geojit Investments, said weakness in global stock markets following the war in West Asia, rupee depreciation, decline in inflows from Gulf countries, high crude oil prices and concerns over the impact on corporate earnings led to sustained selling by foreign investors.
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