Record FPI Withdrawals Hit Indian Stock Market Hard in October

Foreign portfolio investors sold a record Rs 94,017 crore in Indian stocks in October, turning net sellers after months of buying. The market dropped significantly, with Sensex falling from a peak to 79,724 points, attributed to fund outflows and poor Q2 earnings. However, Muhurat Trading showed slight gains.

In a surprising turn for the Indian stock market, foreign portfolio investors (FPIs) divested a record Rs 94,017 crore in October, halting their four-month streak of being net buyers. This massive sell-off led to a sharp downturn in the market's overall performance, according to data from the National Securities Depository Limited.

In the months leading up to October, FPIs invested Rs 26,565 crore in June, Rs 32,365 crore in July, Rs 7,320 crore in August, and Rs 57,724 crore in September, fuelling a bull run and helping indices hit historical highs. FPIs typically involve investors purchasing foreign assets, supporting market gains.

The benchmark Sensex took a hit, plummeting from its all-time peak of 85,978 points to 79,724 points, a decline driven by the extensive FPI withdrawals and lackluster Q2 earnings by Indian companies. On a brighter note, during the special Muhurat Trading session, Sensex and Nifty saw gains, although experts caution ongoing FPI decreases could continue to affect indices.

(With inputs from agencies.)