Foreign Institutional Investors or FIIs offloaded shares worth Rs 5,328 crore on Thursday, making it the biggest pull-out by investors in a single session. The past nine days have seen FIIs dumping Indian markets and Thursday saw them extend their selling streak. In the past nine days, foreign funds cumulatively withdrew Rs 9,900 crore in the Indian market.
However, markets managed to close with gains despite heavy selling by these foreign funds as domestic institutional investors went aggressive, with DII buying increasing by Rs 5,196 crore. It is likely that state-owned Life Insurance Corporation (LIC) and some large mutual funds (MFs) were nudged by the government to contain the situation, brokers said.
Such aggressive selling by FIIs has only been seen twice, in 2013 and 2015, something market insiders pointed out happened when there was a large block deal in a blue-chip stock.
Thursday, however, was different, as several big-ticket FIIs offloaded their positions. The markets would have tanked had domestic institutional investors not provided enough buying support. The BSE’s benchmark Sensex managed to recover from early losses to close 123 points or 0.4 per cent higher, at 31,282.5. The index managed to end its seven-day losing streak, during which it lost close to four per cent.
On a month-to-date basis, FIIs have pulled out around Rs 12,500 from domestic stocks, while MFs have been strong buyers of Rs 17,450 crore. Daily buying and selling numbers for insurance companies are not published separately.