The process of withdrawal of investment by FPI from Indian stock market is continuing. Foreign investors are withdrawing their money due to the weakness in rupee against dollar and increase in US bond yield as well as signs of weakness in quarterly results of domestic companies. Amidst these signs, FPI has withdrawn investment of Rs 64,156 crore from equity market so far this month which is equivalent to 7.44 billion dollars. According to the data of depository, foreign investors had invested Rs 15,446 crore in the market in December, after which this decline has been seen now.

Why are foreign investors selling?
 

According to experts, there are many such signs in the market due to which foreign investors are withdrawing their money. In a PTI news, Himanshu Srivastava, Associate Director - Manager Research, Morningstar Investment Advisors India, said that the continuous fall in the Indian rupee has put a lot of pressure on foreign investors, due to which they are withdrawing money from the Indian equity markets. Apart from this, foreign investors have become more cautious in view of the high valuations even after the recent correction in stocks amid signs of weakness in the earnings of companies and concerns related to the economy. At the same time, uncertainties about Trump's policies have also prompted investors to be cautious and they are keeping distance from risky decisions in terms of investment. That is, at present they are away from new investments. When will FIIs return? According to the data, FPIs have withdrawn an investment of Rs 64156 crore from the equity market till January 24 in the month of January. Foreign investors have made net sales in every session except January 2 this month. VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said that FIIs are selling in the market due to the continued rise in the dollar and the continued rise in bond yields. As long as the dollar index remains above 108 and the bond yield remains above 4.5 percent, this selling may continue.