FPIs sold highest ever equities, worth Rs 58,711 crore in first 12 days of October

Domestic investors, both institutional and retail, have been showing their growing influence in the Indian stock markets for quite some time, even as their foreign counterparts have been selling shares in huge quantities over the last few trading sessions.

According to data by NSDL, in just 12 days of October, it became the highest-selling month by foreign investors in the equity market. So far this month, foreign investors have sold net equities worth Rs 58,711 crore. This is the highest selling in any month this year.

This week (7th Oct-11th Oct), as per the data, foreign investors sold equities worth Rs 31,568.03 crore. Last week, they sold equities worth Rs 27,142.17 crore.

On days of extreme market volatility, FPIs have been aggressively offloading their stakes. Between September 30 and October 4, FPIs sold shares worth around Rs 27,142.17 crore, with the most significant selling witnessed on October 4, when they were net sellers at Rs 15,506 crore.

Domestic investors, particularly mutual funds, counterbalanced this with strong buying, as mutual funds were net buyers at Rs 57,792.20 crore this month.

Other categories of domestic investors also showed confidence in the market despite external selling pressures. During this period, they picked up shares worth around Rs 11,633 crore. Insurance companies also contributed to the buying, with net purchases amounting to Rs 1,859 crore.

Banks and Portfolio Management Services (PMS) were also net buyers, picking up shares worth Rs 723 crore and Rs 169 crore, respectively.

Seeing strong support from domestic investors, most market experts continue to remain positive about the stability of the Indian market. Experts believe that with strong support from domestic investors, India's dependence on FPIs has reduced over time.

"The market traded sideways due to a lack of fresh triggers for decisive momentum. The uptick in the US 10-year yield due to the unexpected rise in US core inflation and caution ahead of the results season added layers of sentiment in the market. The ongoing geopolitical challenges influenced FIIs to shift their focus towards the affordable markets, which is impacting domestic market liquidity," said Vinod Nair, Head of Research, Geojit Financial Services.