FPIs Pull Out Over $8 Billion; Indian Markets Shed Over 23% In March
The month of March proved to be a month of chaos for the Indian stock markets. As fears of rising cases of coronavirus threatened to push the global economy into a recessionary phase, market players including foreign portfolio investors (FPIs) resorted to relentless selling in March. As a result investors lost wealth of more than Rs 30 lakh crore ($399 billion) in a single month.
The S&P BSE Sensex and the Nifty50 fell about 23 percent each to post their worst fall since October 2008. Investors lost more than Rs 33 lakh crore in a single month as the average market capitalisation of BSE-listed companies fell from Rs 146.87 lakh cr on Feb 28 to Rs 113.48 recorded on March 31.
The large part of the fall was led by consistent selling by FPIs who have pulled out more than Rs 62,000 crore ($8.27 billion) from Indian equity markets from the cash segment so far in March, provisional data showed.
The market movements have become unpredictable post outbreak of COVID-19 and after most of the world has undergone lock down. A day after logging healthy gains, market benchmarks the Sensex and the Nifty were back in the negative territory on April 1, tracking weak global cues.
The 30-share Sensex ended 1,203 points, or 4.08 percent, down at 28,265.31 and the Nifty settled 344 points, or 4 percent, lower at 8,253.80 on Wednesday. The BSE Midcap and Small-cap indices remained better off than the benchmarks, down 2.18 percent and 1.06 percent, respectively. All sectoral indices ended in the red on BSE, with the BSE Bankex, IT and Teck falling over 5 percent each.
India declared locked down throughout the country on March 24, a week ago. Since then however, the benchmark indices have posted gains of around 8 per cent with Sensex up by 2,285 points and Nifty up by 644 points as on Wednesday.
With 21 days of lockdown in India and a complete halt of economic activity across the globe due to rising cases of COVID-19 has fuelled fears of economic recession, one of its worst seen in the last 150 years.
In tandem with the global markets, D-Street witnessed one of its worst month in the last 12 years. More than 90 percent of the Nifty50 stocks hit a fresh 52-week low or multi-year lows in the same period.
However, the bigger carnage was seen in individual stocks. As many as 43 stocks in the BSE500 index fell over 50 percent in the month of March.
