Foreign investors withdrew a net crore of Rs 7,622 from Indian markets in April, as a surge in COVID-19 cases and the resulting restrictions imposed by various states alters investor sentiment.
According to data from custodians, foreign investors withdrew Rs 8,674 crore from the stocks, but invested Rs 1,052 crore in the debt segment.
The total net withdrawal between April 1 and April 23 was Rs 7,622 crore.
Previously, REITs invested Rs 17,304 crore in March, Rs 23,663 crore in February, and Rs 14,649 crore in January.
REITs have been “net sellers in the stock markets for five consecutive weeks,” noted Himanshu Srivastava, Associate Director – Research Director, Morningstar India.
Srivastava said the recent wave of net exits could be largely attributed to the huge outbreak of the COVID-19 pandemic in India, which has led several states to impose restrictions to bring the situation under control.
While the impact of a more severe second wave of the pandemic on the economy remains to be determined, it has definitely dashed hopes for a rapid economic recovery, he added.
Regarding investments in the debt segment, he said: “The uncertainty in the stock markets has made India’s debt markets relatively attractive from a short-term perspective.”
VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services noted that, in line with the general market trend, there is a sale of stocks like banking and buying stocks with global links like IT, metals and pharmaceuticals.
“REITs are also more or less following this trend,†he said.
Investments could turn positive again once COVID-19 cases start to decline and the effects of vaccination continue, said Harsh Jain, co-founder and COO at Groww.
