Changes in investor spirit highlighted instability and developing dynamics in global financial markets. File | Photo Credit: Hindu
Foreign investors withdrew of Rs 10,355 crore from equity markets in the last four trading sessions of this month, which due to tariffs imposed by the US including India, on most nations including India.
According to deployment data, “From March 21 to March 28, there was a outfit after a net investment of ₹ 30,927 crore in six trading sessions. The infusion helped reduce the overall outflow for March.”
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In February, foreign portfolio investors (FPIs) took out ₹ 34,574 crore, while the outflow was more than ₹ 78,027 crore in January. This change in investor spirit highlighted instability and developing dynamics in the global financial markets.
Moving forward, the market participants will closely track the long-term impact of the proposed tariff, as well as the upcoming announcements of the Reserve Bank of India (RBI), as well as their monetary policy stance amidst the expectations of a possible rate cut, said Manoj Purohit, Partner and Leader, FS Tax, Tax, Tax, Tax, Tax and Regulatory Services, said BDO India.
“These events will play an important role in shaping investment strategies for the upcoming cycle,” he said. According to the data, the FPI has taken out of the Indian equity of 10,355 crore from Indian equity in the last four trading sessions (from 1 April to April 4, 2025). With this, the total outflow by FPIS has reached ₹ 1.27 lakh crore so far in 2025.
VK Vijaykumar, the main investment strategist at Geogit Investments, said, “Tariffs, which were much more stable than the anticipated, expressed concern about their comprehensive economic impact.”
He reported that 25% tariffs on automobile imports and 25% tariff on most countries (26% on India), 10% baseline tariff on all imports, can cause high inflation in the US, it is also an increasing concern that these measures can push the US economy towards stability.
This uncertainty triggers large -scale sales in US markets, with S&P 500 and Nasdaq reduced more than 10% in just two days. Mr. Vijaykumar said, “A full-developed trade war capacity can have far-reaching consequences, which affects global trade and economic growth. However, the decline by 102 in the dollar index is considered favorable for capital flow in emerging economies such as India,” said Mr. Vijaykumar.
In addition to equities, FPI withdraws Crore 556 crore from the loan general limit and withdrew the Core 4,038 crore from the loan voluntary retention route.
Published – 06 April, 2025 12:06 pm IST
