India recorded the highest foreign fund outflows in May among emerging markets as election uncertainty created panic in Dalal Street.
Foreign institutional investors have been selling Indian stocks during all the sessions except two, according to the provisional data from the National Stock Exchange.
The uncertainty in the Lok Sabha elections is causing concerns for Foreign Institutional Investors, according to Sunil Damania, Chief Investment Officer of MojoPMS.
Another major trigger for the selloff could also be the outperformance of Chinese stocks, according to VK Vijayakumar, Chief Investment Strategist of Geojit Financial Services.
This boom in Chinese stacks coupled with low valuations attracted FPIs who sold in expensive India and bought cheap Chinese stocks."
India recorded the highest foreign fund outflows in May among emerging markets as election uncertainty created panic in Dalal Street.
Overseas investors have been selling domestic equities since the start of the month on fears of the uncertain election verdict due to the less-than-expected voter turnout in the Lok Sabha elections.
Foreign institutional investors have been selling Indian stocks during all the sessions except two, according to the provisional data from the National Stock Exchange. They have pulled out around $2.97 billion from the Indian market so far this month.
The uncertainty in the Lok Sabha elections is causing concerns for Foreign Institutional Investors, according to Sunil Damania, Chief Investment Officer of MojoPMS. "However, elections are not the only factor influencing FIIs to sell in Indian markets. Elevated market valuations and profit-taking after a strong rally also play a role."
Another major trigger for the selloff could also be the outperformance of Chinese stocks, according to VK Vijayakumar, Chief Investment Strategist of Geojit Financial Services. "The Hang Seng index rallied around 20% from April 19 to May 20. This boom in Chinese stacks coupled with low valuations attracted FPIs who sold in expensive India and bought cheap Chinese stocks." The election jitters are secondary, he said.
