REITs so far withdrew Rs 5,689 cr from Indian stocks in July, Auto News, ET Auto

New Delhi: Foreign portfolio investors (REITs) offloaded Indian equities to the tune of more than Rs 5,689 crore in July as they continued to adopt a cautious stance given various domestic and global factors. From July 1 to July 23, REITs withdrew Rs 5,689.23 crore from shares, according to custodian data.

During this period, they invested Rs 3,190.76 crore in the debt segment.

Thus, the net drawdown during the reporting period amounted to Rs 2,498.47 crore.

Rising valuations, soaring oil prices and the strength of the U.S. dollar would have made foreign investors wary of near-term risks, causing them to stay on the sidelines, said Himanshu Srivastava, associate director – research on managers, Morningstar India.

Harsh Jain, co-founder and COO of Groww, said that further, with Sensex and Nifty hovering around the all-time high, foreign investors are being cautious when investing money.

VK Vijayakumar, chief investment strategist at Geojit Financial Services, said: “They have been continuous sellers in the spot market over the past six trading days.”

Turning to other emerging markets, Arun Agarwal, assistant vice president of fundamental research at Kotak Securities, said that all major emerging markets and Asian markets saw REIT outflows this month except from Indonesia.

“Reit flows into India are likely to remain vulnerable to US Fed monetary policy and rising crude oil prices. In addition, investors should note that the wide valuation gap between large caps and small caps and mid caps has been filled,” said Shrikant Chouhan, Vice Director. President, Technical Equity Research at Kotak Securities.

Srivastava added that India remains an attractive investment destination from a long-term perspective. As the macroeconomic environment improves and the domestic economy begins to return to the path of recovery, PEI flows can be expected to rebound.

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