Indian stocks are having their worst month since the COVID-19 pandemic hit in March 2020. Foreign investors have been selling off Indian shares, causing a big drop in the market.
- FIIs have dumped over ₹1.11 lakh crore worth of Indian stocks in the last 20 trading sessions.
- Benchmark indices, Nifty 50 and Sensex have plunged over 6% in October.
- Domestic Institutional Investors (DIIs) have been buying Indian stocks to counterbalance FII selling, preventing a deeper market crash.
- Nifty Oil & Gas and Nifty Auto have been the worst-hit sectors, while Nifty IT has remained relatively resilient.
Why the FII Exodus?
Several factors are contributing to the FII sell-off:
When interest rates go up in the US, people find US-based investments more appealing, which can lead them to move money away from countries like India.
Investors are feeling uneasy due to fears of a worldwide economic slowdown and a possible recession.
As China takes steps to strengthen its economy, some investors might start paying more attention to Chinese stocks.
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