FPIs sell over £1.7 bn worth stocks in 6 sessions on poll jitters

Foreign fund managers are taking money off the table amid a surge in market volatility due to uncertainty surrounding the outcome of the Lok Sabha elections. At the same time, domestic institutions - mainly mutual funds - have been big buyers on Dalal Street.
In addition to poll-related jitters, a recent rally in Chinese stocks may also be pushing foreign investors to shift some funds out of India to China and Hong Kong, market players said.
In just six trading sessions this month, FPIs have net sold stocks worth about £1.71 bn, data from CDSL showed.
Moreover, excluding net foreign fund inflows through the primary market, the net outflow from the cash market will be around £2.5 bn. In April, FPIs recorded a net outflow of £867.1 mn, while the corresponding figure in March was a net inflow of £3.51 bn, CDSL data showed.
According to Siddhartha Khemka of Motilal Oswal Financial Services, heavy foreign fund selling and concerns over the outcome of the ongoing general elections are weighing on market sentiment.
In contrast to net selling by FPIs, cumulative buying by domestic institutional investors in May stands at £1.94 bn, data from BSE showed. Particularly, it’s mutual funds that together got over £2 bn of retail money through SIPs in April that are investing aggressively in the stock market, dealers said. Net buying by DIIs in April was £4.41 bn, while it was £5.63 bn in March, BSE data showed.