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The ongoing <keyword id="20168812" type="General" weightage="20" keywordseo="sell-off" source="keywords">sell-off</keyword> by <keyword id="19900795" type="General" weightage="20" keywordseo="foreign-investors" source="keywords">foreign investors</keyword> continues to loom large on <keyword id="19991358" type="General" weightage="20" keywordseo="Indian-markets" source="keywords">Indian markets</keyword>. In October so far, <keyword id="19950996" type="General" weightage="100" keywordseo="FIIs" source="keywords">FIIs</keyword> (foreign institutional investors) have already withdrawn Rs 74,732.20 crores. Not for a single day this month have FIIs poured money into <keyword id="19895063" type="General" weightage="20" keywordseo="india" source="keywords">India</keyword>. The sell-off started on October 1, when foreign investors withdrew Rs 5,579.35 crore. The highest withdrawal of this month came on October 3. 2024, when FIIs sold Rs 15,243.27 crore worth of assets. Yesterday, i.e. on October 17th, FIIs pulled out Rs 7,421.40 crore from the markets. Experts state that FIIs are continuously putting pressure on Indian stocks, but the situation is expected to improve in the coming weeks with a sharp recovery anticipated. "We remain optimistic as the FII selling may have crossed the half way mark already and as it tones down, the domestic flows will help a recovery. When the recovery happens it will sharp and concentrated, giving long term investors motivation to stay put during the harrowing volatility of a roller coaster market that has repeatedly tested support levels but remains oversold, hence ripe for a bounce sometime in the next few weeks" said Ajay Bagga, Banking and Market Expert to ANI. Between January and October 2024, foreign investors have invested a net of 1,87,298 crore in India. This year, apart from the current sell-off, January, April and May also saw <keyword id="23593694" type="General" weightage="20" keywordseo="investment-outflows" source="keywords">investment outflows</keyword> by FIIs. The intense selloff comes right after September, when foreign investors invested a record Rs 93,538 crore in the Indian markets. June, July and August 2024 had also seen positive inflows from foreign investors of about Rs 41,757 crore, Rs 48,796 crore and Rs 25,493 crore respectively. However, a resilient, strong domestic investor base is keeping Indian markets afloat. <keyword id="21714171" type="General" weightage="20" keywordseo="DIIs" source="keywords">DIIs</keyword> (domestic institutional investors) have been consistent buyers throughout this month, largely balancing the outflows prompted by FIIs. In October so far, DIIs have invested about Rs 68,961.37 crore in the market, with the highest monthly inflow coming in on October 7th. While DIIs invested Rs 13,245.12 crore in Indian markets on that day, foreign investors withdrew Rs 8,293.41 crore. Yesterday i.e. on October 17, 2024, DIIs invested Rs 4,979.83 crore in the markets. At present, experts note that DIIs are flush with cash at the moment, with <keyword id="20052797" type="General" weightage="20" keywordseo="mutual-fund-inflows" source="keywords">mutual fund inflows</keyword> reaching an all-time high of Rs 24,509 crore in September 2024, a record 52.78% jump from the corresponding year ago period, where they stood at Rs 16,042 crore. Generally, keeping around 3-5% of their assets in cash is considered an acceptable practice amongst mutual fund houses. As per reports, mutual funds are currently in possession of Rs 1.86 lakh crore worth of cash, which constitutes 5.03% of their total AUM as of September 2024.

Exodus of foreign investors from Indian markets continues unabated in October. But DIIs are holding the fort steady

India could see a shift in foreign direct investment (FDI) trends in the second term of Donald Trump (Trump 2.0) as President of the United States, says a research report by the State Bank of India. The report highlighted that under his first term, Trump 1.0, the Trump administration made sweeping regulatory changes aimed at attracting investments back to the U.S., which impacted FDI inflows globally, including India. It added that if similar policies are reintroduced in Trump 2.0 also, it could create challenges for emerging markets like India, which rely on FDI as a significant driver of economic growth. Notably, a recent Kotak report highlighted that a complete Republican control over all arms of the US government would mean increased US earnings via corporate tax cuts, higher tariffs on imports into the US and greater US fiscal deficits. The first two could spell doom for emerging markets like India and China, since foreign investors will make a beeline for investing more money in the US markets, which will come at the cost of intense selloff in emerging markets. However, higher fiscal deficits will eventually lead to the dollar weakening after the initial euphoria dies down. "India may see shifts in foreign direct investments (FDIs) during Trump 2.0. The Trump 1.0 administration saw significant regulatory changes aimed at attracting investments back to the US," the SBI report stated. However, given that India has been gradually diversifying its sources of FDI (foreign direct investments), this trend could serve as a buffer against any potential decline. Moreover, domestic institutional investors have been stepping up big time, maintaining some balance to the massive exodus of FIIs over the past month. So far in November 2024, FIIs have withdrawn Rs 19,849 crores from the cash segment in Indian markets, while DIIs have poured in Rs 14,014.18 crores as of November 10th, 2024. "India is no longer dependent on the traditional sources of FDI inflows... unlike the recent past, FDI is now coming in many new sectors," noted the SBI report. Unlike a decade ago, when most FDI inflows came from a limited number of traditional sectors, India is now attracting investment in a wide array of industries, including renewable energy, sea transport, medical devices, and surgical appliances. Data suggests over the last 24 years, i.e., between April 2000 and June 2024, FDIs have poured in $1,013.4 billion in the Indian economy. Out of this, 67%, i.e., $689.88 billion, has come in just the last 10 years. The report added there are up to 12 emerging sectors showing strong FDI interest, which could help offset any loss of inflows in conventional sectors if there is a shift in global investment patterns under another Trump administration. In the last financial year, the top 5 sectors that have received the highest quantum of FDI inflow include the services sector (finance, banking, insurance, and business) which makes up about 16% of the inflows. This is followed computer software &amp; hardware, which constitute around 15% of total FDI flows. Trading and telecommunications follows with a share of 6% each, and Automobile Industry comes next with a 5% share. In the short term, the potential for increased U.S. tariffs, more restrictive H-1B visa policies, and a stronger dollar could bring some volatility to India's trade and investment landscape. However, in the long term, these challenges might also encourage India to expand its manufacturing capabilities, diversify export markets, and focus on becoming economically more self-reliant. Notably, India has maintained a merchandise trade surplus with the U.S. despite tariffs imposed during Trump's first term. This indicates that Indian exports have remained resilient, and there is potential to strengthen this trade relationship further by capitalizing on emerging sectors and reducing dependency on traditional industries. Suman Chowdhury, Executive Director &amp; Chief Economist, Acuité Ratings &amp; Research Limited cautions that in the medium to long term, the trade relationship with the US may see a structural improvement. "Higher tariff and trade restrictions in the US with China should translate into better opportunities for exports of manufactured goods from India", he adds.

FDIs may shift to US under Trump 2.0 but it is unlikely to severely impact FDIs inflow to India, says SBI Report

The Rupee tumbled 45 paise to close at 83.59 (provisional) against the <keyword id="19949640" type="General" weightage="20" keywordseo="US-dollar" source="keywords">US dollar</keyword> on Tuesday as the ruling <keyword id="19894848" type="General" weightage="20" keywordseo="BJP" source="keywords">BJP</keyword> is unlikely to muster an absolute majority in the <keyword id="19923279" type="General" weightage="20" keywordseo="Lok-Sabha-elections" source="keywords">Lok Sabha elections</keyword>. Besides, a massive sell-off in domestic <keyword id="19925781" type="General" weightage="20" keywordseo="equities" source="keywords">equities</keyword> and a strong <keyword id="20226143" type="General" weightage="20" keywordseo="greenback" source="keywords">greenback</keyword> against major currencies overseas added to the gloom, <keyword id="20024982" type="General" weightage="20" keywordseo="forex-traders" source="keywords">forex traders</keyword> said. At the interbank foreign exchange market, the local unit opened weak at 83.25 and oscillated between a high of 83.23 and a low of 83.59 against the greenback during the session. The domestic currency finally closed at 83.59 (provisional) against the dollar, registering a fall of 45 paise from its previous close. On Monday, the Rupee closed at 83.14 against the US dollar. Counting of votes on Tuesday indicated disappointing results for the BJP-led NDA in the Lok Sabha elections, which appears to be losing heavily in its strongholds of Uttar Pradesh, Haryana and Rajasthan although it is expected to form the government with about 290 seats. On its own, the Bharatiya Janata Party appeared to be falling below the majority mark with leads in 236 seats despite significant gains in Odisha, Telangana and Kerala, giving some solace to the party after the unexpected losses in the Hindi belt. Its rival INDIA alliance was leading in about 230 seats. In the last elections, the BJP had 303 seats on its own, while the NDA had over 350. "The rupee depreciated...today as domestic markets fell sharply amid uncertainty over election results outcome. This may have also led to some sell-off by <keyword id="19900795" type="General" weightage="20" keywordseo="foreign-investors" source="keywords">foreign investors</keyword>. The US dollar recovered from yesterday's losses on the weak Euro, which fell on disappointing employment data. The US dollar fell on Monday on weaker than expected ISM manufacturing PMI and construction spending," Anuj Choudhary - Research Analyst at Sharekhan by BNP Paribas, said. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.17 per cent higher at 104.25. Brent crude futures, the global oil benchmark, dropped 1.88 per cent to USD 76.89 per barrel. On the domestic equity market, the 30-share <keyword id="19950208" type="General" weightage="20" keywordseo="BSE-Sensex" source="keywords">BSE Sensex</keyword> crashed 4,389.73 points, or 5.74 per cent, to close at 72,079.05. The broader NSE <keyword id="19896381" type="General" weightage="20" keywordseo="Nifty" source="keywords">Nifty</keyword> tumbled 1,379.40 points or 5.93 per cent to 21,884.50. Foreign investors were net buyers of Indian equities on Monday as they purchased shares worth Rs 6,850.76 crore on a net basis. FIIs bought shares worth Rs 23,451.26 crore and sold equities worth Rs 16,600.50 crore in the cash segment.

Rupee plunges 45 paise to close at 83.59 against US dollar

<ul class="summary-list"><li>Global stock markets plummeted on August 5, 2024, led by sharp declines in Asia.</li><li>The selloff was partly due to the Bank of Japan's interest-rate hike on July 31.</li></ul>Monday could go down as one of the worst days for stocks in recent history.The <a target="_blank" class="" href="https://www.businessinsider.com/markets-japan-rate-hike-yen-fx-carry-trade-stock-futures-2024-8">market rout</a> started in Asia, where stocks kicked off with sharp declines that only got worse over the day. US futures and European stock markets also got dragged into the fray. Major crypto coins, including Bitcoin and Ether, took significant hits. To be sure, markets were already jittery before Monday's rout due to fears of a US recession, <a target="_blank" class="" href="https://www.businessinsider.com/big-tech-investors-wary-high-ai-spending-markets-selloff-nasdaq-2024-7">caution over the AI hype,</a> and geopolitical tensions in the Middle East. But, as Tony Sycamore, an analyst at IG Australia, told <a target="_blank" rel=" nofollow" class="" href="https://www.bloomberg.com/news/videos/2024-08-05/ig-there-are-concerns-fed-has-fallen-behind-the-curve-video">Bloomberg TV,</a> it was the Bank of Japan's interest rate hike on July 31 that was "the straw that broke the camel's back.""We haven't seen a day of carnage like this, really, since the COVID selloff back in February, March 2020," Sycamore told the network.The VIX index, a key volatility indicator, was up 48% at one point on Monday, a four-year high.Here's how the massive selloff hit stock markets.<h2 id="2177269e-fb45-47e5-8a25-92378fa12c4c">Japan's Nikkei 225 revisited Black Monday</h2>Japan's stock market has been a standout over the past few years, with the benchmark <a target="_blank" class="" href="https://markets.businessinsider.com/index/nikkei_225">Nikkei 225</a> index posting <a target="_blank" class="" href="https://english.kyodonews.net/news/2024/03/d82c94fba484-urgent-nikkei-stock-index-finishes-up-44-in-fy-2023.html#google_vignette">outsized gains of 44%</a> in 2023 that bettered those from the <a target="_blank" class="" href="https://markets.businessinsider.com/index/s&amp;p_500">S&amp;P 500.</a>The Nikkei continued to extend gains in 2024, first hitting a <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/aisstocks-japan-nikkei-225-index-recession-economy-record-high-advantest-2024-2">record high in February</a> — the first time in 34 years — before breaching new highs.Its gains were fueled by the AI boom, as well as a weak yen that made it cheaper for foreign investors to buy Japanese equities. The weaker currency also helps Japanese exporters selling products overseas.However, the BOJ's interest-rate hike unwound trades related to the yen, sending the Nikkei way down and wiping out all of its gains this year.On August 5, the <a target="_blank" rel="" class="" href="https://markets.businessinsider.com/index/nikkei_225">Nikkei 225</a> index crashed by as much as 13% and closed 12.4% lower — <a target="_blank" rel=" nofollow" class="" href="https://asia.nikkei.com/Business/Markets/Equities/Japan-stocks-dive-4-451-points-more-than-Black-Monday-in-1987">the worst </a><a target="_blank" href="https://asia.nikkei.com/Business/Markets/Equities/Japan-stocks-dive-4-451-points-more-than-Black-Monday-in-1987">since</a> the <a target="_blank" rel="" class="" href="https://www.businessinsider.com/1987-black-monday-stock-market-crash-most-important-lesson-2017-10">Black Monday</a> stock market crash of October 1987, when the Japanese index lost 14.9%.The Nikkei shedding 4,451.28 points was also its largest-ever loss in terms of points.<h2 id="0263e9c8-27ee-4543-b41b-8e770fbc0528">South Korea's Kospi saw worst days since the Global Financial Crisis</h2>South Korea's <a target="_blank" class="" href="https://markets.businessinsider.com/index/kospi">Kospi</a> also marked a grim milestone on August 5 after closing 8.8% lower. Its losses were so huge that trading halts kicked in.The Kospi's decline was its <a target="_blank" class="" href="https://www.reuters.com/markets/asia/skorean-shares-trigger-trading-curb-first-time-since-2020-amid-tech-rout-2024-08-05/">biggest percentage decline</a> since October 24, 2008 during the Global Financial Crisis.The losses were driven by heavy declines in the shares of semiconductor chip heavyweights Samsung Electronics and SK Hynix, which tanked 10.3% and 9.9%, respectively.Like Japan, the Kospi has been <a target="_blank" class="" href="https://www.reuters.com/markets/hedge-funds-turn-south-korea-next-wave-ai-2024-07-11/">boosted by the AI rush</a> as investors bet on its chipmakers.<h2 id="80173012-7e3a-40b6-9e88-5bd1ee0d54d3">Taiwan's stock market experienced its worst day ever</h2>Taiwan's benchmark Taiex stock index closed 8.4% lower in its worst day since 1967, when trading started.Taiwan is the world's semiconductor hub, where chip giant Taiwan Semiconductor Manufacturing Company is based, so the Taiex has also benefited tremendously from the AI craze.The index surged nearly 70% from the start of 2023 to its record high last month, before massively crashing on August 5, marking its worst day in history.On Monday, TSMC shares closed nearly 10% lower.<h2 id="76339a18-f283-4722-8c9d-638ea19d1f84">Australia's ASX200 posts largest decline since May 2020</h2>Among the sea of red in Asia, Australia's <a target="_blank" class="" href="https://markets.businessinsider.com/index/s&amp;p_asx_200">ASX 200</a> index appeared less bruised.The benchmark Australian index closed 3.7% lower, but still marked its <a target="_blank" class="" href="https://www.aap.com.au/news/worst-day-for-asx-in-four-years-over-us-recession-fears/">largest one-day decline</a> since May 2020, during the thick of the COVID-19 pandemic.The ASX200's losses were led by losses in IT stocks.However, Australia is a commodity giant and the ASX's largest company by market value is miner BHP, which fell just 2.1%. Fellow mining heavyweights Fortescue and Rio Tinto fell 1.9% and 0.1%, respectively.

Asia's stock markets tanked, marking several recent records in today's massive selloff

<keyword id="19900618" type="General" weightage="100" keywordseo="investors" source="keywords">Investors</keyword>' wealth eroded by Rs 9.51 lakh crore on Monday morning, following a <keyword id="20028816" type="General" weightage="20" keywordseo="crash" source="keywords">crash</keyword> in equity <keyword id="19990226" type="General" weightage="20" keywordseo="markets" source="keywords">markets</keyword> where the benchmark Sensex tanked over 2,400 points, mirroring a sharp plunge in global peers. The 30-share BSE benchmark tanked 2,401.49 points to 78,580.46 in early trade. Following the sharp decline in equities, the market capitalisation of BSE-listed firms dropped by Rs 9,51,771.37 crore to Rs 4,47,65,174.76 crore (USD 5.35 trillion) during the morning trade. "The global market is reeling as bears enter with a cocktail of bad news. The fear of a reverse Yen carry trade, following an interest rate hike in Japan, was the initial catalyst. This was compounded by fears of a recession in the USA after extremely poor jobs data, which spooked market sentiment," said Santosh Meena, Head of Research, Swastika Investmart Ltd. Indian equity markets are witnessing signs of the first meaningful correction in global markets after an extended bull run, he added. In Asian markets, Seoul, Tokyo, Shanghai and Hong Kong were trading sharply lower. Japan's benchmark Nikkei 225 stock index plunged as much as 8.1 per cent early Monday, extending sell-offs that shook world markets last week as worries flared over the state of the US economy. The US markets ended significantly lower on Friday. "The rally in the global stock markets has been driven mainly by consensus expectations of a soft landing for the US economy. This expectation is now under threat with the fall in US job creation in July and the sharp rise in the US unemployment rate to 4.3 per cent. "Geopolitical tensions in the Middle East also are a contributing factor," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services. From the Sensex pack, Tata Motors, Maruti, Tata Steel, Infosys, Tech Mahindra and JSW Steel were the biggest laggards. On the contrary, Hindustan Unilever, <keyword id="20026907" type="General" weightage="20" keywordseo="sun-pharma" source="keywords">Sun Pharma</keyword>, Nestle and Asian Paints were trading in the positive territory. Foreign Institutional Investors (FIIs) offloaded equities worth Rs 3,310 crore on Friday, according to exchange data.

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Exodus of foreign investors from Indian markets continues unabated in October. But DIIs are holding the fort steady

Ira Alok Puranik

FDIs may shift to US under Trump 2.0 but it is unlikely to severely impact FDIs inflow to India, says SBI Report

Ira Alok Puranik

Rupee plunges 45 paise to close at 83.59 against US dollar

PTI

Asia's stock markets tanked, marking several recent records in today's massive selloff

Huileng Tan

Investors become poorer by Rs 9.51 lakh crore as markets crash

PTI

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