Foreign investors withdraw ₹3,765 cr from stock market in November:Dip comes after net inflow of ₹14,610 cr in October; know global and domestic reasons

In November, foreign portfolio investors (FPIs) again began selling in the Indian stock market. They have withdrawn ₹3,765 crore so far this month, marking a sharp reversal after strong inflows in October. According to market experts, uncertainty over US Federal Reserve interest rates and global risks has weakened investor confidence. FPIs invested ₹14,610 crore in October In October, FPIs had invested ₹14,610 crore in Indian equities, breaking the three-month selling streak seen from July to September. During that period, FPIs withdrew ₹17,700 crore in July, ₹34,990 crore in August and ₹23,885 crore in September. So far this year, foreign investors have pulled out more than ₹1.43 lakh crore from the equity market. Conditions are slightly better in the debt market, where ₹8,114 crore were invested under the general limit. However, ₹5,053 crore were pulled out through the Voluntary Retention Route (VRR). Global and domestic factors turning unfavourable; risk-averse strategy adopted Global factors remain the biggest reason behind the sell-off by foreign investors. Uncertainty over US Federal Reserve rate-cut decisions, a stronger dollar, weak risk appetite in emerging markets, geopolitical tensions and volatile crude oil prices have made investors cautious. Domestically, high valuations in some sectors and sluggish industrial indicators have also dented confidence, although macroeconomic conditions remain stable. Himanshu Srivastava, Principal Manager Research at Morningstar Investment Research India, said global uncertainties have strengthened the risk-off tone. High valuations in parts of the domestic market and weak industry data are affecting investor sentiment. IT, consumer and healthcare sectors most affected The sell-off has hit IT services, consumer services and healthcare sectors the most. Global risk aversion and volatility in tech stocks have led FPIs to target these segments. Vaqar Javed Khan, Senior Fundamental Analyst at Angel One, said that global risk aversion and tech volatility have impacted these sectors heavily. Investors will keep an eye on the Fed’s rate-cut signals in December and the progress of the India-US trade pact. However, there are still no clear signs of a trend reversal. FPIs were buyers on some days and sellers on others. V K Vijayakumar, Chief Investment Strategist at Geojit Investments, said there is no clear trend in FPI flows as both buying and selling were seen on different days. However, the sentiment improved when Nifty and Sensex broke record highs on 27 November, supported by strong Q2 earnings and growth expectations for Q3 and Q4. Hopes pinned on Fed signals and trade deal in December Looking ahead, FPI activity in December will depend largely on the US Federal Reserve’s rate-cut indications and the progress of the India-US trade agreement. If these turn positive, the market may see a rebound; if not, the selling streak could continue. Although the recent market rally has offered some relief, investors are advised to remain cautious. FIIs sold ₹3,672.27 crore worth of shares on Friday On Friday, 28 November, the last trading day of the week, the stock market closed lower. Sensex fell 14 points to close at 85,707. Nifty also dropped 13 points to close at 26,203. On 28 November, foreign institutional investors (FIIs) sold shares worth ₹3,672.27 crore in the cash segment, while domestic institutional investors (DIIs) bought shares worth ₹3,993.71 crore. ​