Foreign investors withdraw funds from capital markets for third straight month

For the third straight month, foreign portfolio investors (FPIs) withdrew funds amounting to Rs 9,926 crore from domestic capital markets in January 2016. FPIs had withdrawn Rs 3,984 crore and Rs 11,268 crore in the previous two months, with cumulative net outflows of Rs 25,179 crore during November-January 2015/16 from the capital markets.

Equity markets recorded net outflows of Rs 11,471 crore during January 2016. FPIs purchased shares worth Rs 71,880 crore and sold shares worth Rs 83,351 crore. The institutional investors were net sellers of equity for 15 out of the 20 trading days during the month.

Debt markets witnessed net inflows of Rs 1,544 crore in January 2016. Purchases amounted to Rs 20,049 crore and sales amounted to Rs 18,504 crore.

Outflows were witnessed on the domestic front, too. Mutual fund investments in capital markets fell to a 29-month low during January 2016.  Investments in debt markets fell and in equity markets rose during the month.

Mutual fund investments in the debt markets fell sharply by 83.1 per cent to Rs 6,613 crore in January 2016 compared to the previous month. Debt purchases amounted to Rs 85,687 crore while sales amounted to Rs 79,074 crore. Mutual funds investments in the equity markets rose by 47.5 per cent to Rs 6,702 crore compared to the preceding month. Equity purchases rose to a five-month high of Rs 24,641 crore, while sales rose to a three-month high of Rs 17,939 crore.