04/02/2025
Foreign investors (FPIs) have withdrawn more than 10 billion dollars (₹87,000 crore) from the Indian stock market in January 2025. Many people are worried about this seller, but I want to pay attention to when they come back.
The main reason for this withdrawal is straight—money always goes where better returns are. At the moment, American markets (both stocks and bonds) are giving better returns by dollars, so capital is going out of India.
However, I believe that if two of the following conditions are met, FPIs will make a return to the Indian market:
1. The USD Index (DXY) would fall below 105, and better if it's close to 100.
2. America's 10-year bond yield go down 3.5-4%.
3. May the NASDAC (American Tech Stocks) rating back to its average level.
For the first time in the last six months, NASDAC has given negative returns on a monthly basis. This could be the early sign of change.
Yes, FPIs are selling right now, but they will return too. The real opportunity is for those who make the right position before their return.
👉 The dollar is not sure to come at the actual price as long as the sword of tariff war is hanging.
