Fiis Selling: January 2025 is proving to be a black month for Indian stock markets. Foreign institutional investors ie FIIS have sold around $ 7.8 billion (about Rs 67,000 crore) in Indian stock markets so far this month. This is the largest selling made by Fiis in any month of January. Even more important is that if the selling of FIIS continues in the same way, then this month can be recorded as the worst month in history in terms of selling. Right now foreign investors had previously had such an aggressive selling on just 2 occasions- $ 8.4 billion in March 2020 and $ 11.2 billion in October 2024.
Fiis has done the best selling financial shares in the first two weeks of January. He has sold financial shares worth about $ 1.41 billion. After this, he has sold $ 40 million in consumer services, $ 36 million in power sector and $ 30.3 million in capital goods. Apart from this, he has also sold heavily in sectors like metals, IT, automobiles, and construction and in all these sectors he has sold shares worth more than $ 20 million.
The effect of this selling is also clearly visible on the benchmark index. Sensex and Nifty have fallen by 3.5% in January so far. This is the biggest decline in any month of January since 2017. In addition, BSE midcap and smallcap index have also broken more than 9%.
So why is this heavy selling? Market analysts say the stock market is currently facing many challenges such as geopolitical tension, lethargy in global economy, high interest rates, weak quarterly results of companies. In addition, the uncertainties arising after Tariff War and Donald Trump were re -elected President of America have also increased the concerns of investors.
In the midst of this, the high valuation of the Indian stock markets has further increased the selling pressure. Analysts say that the recent sharp decline in the stock market has improved some improvement and since September 2024, Earning Yield has exceeded 5%.
According to a report by ICICI Securities, as soon as the US Bond Yield and Dollar Index start to stabilize from their current peak, the valuation of Indian stock markets can improve. This is likely to provide relief to domestic markets.
However, market experts believe that the long-term possibilities of the Indian stock market are still strong. According to a report by ICICI Securities, as soon as the US Bond Yield and Dollar Index start to stabilize from their current peak, Indian stock markets can get relief.
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