Foreign investors have been pulling money out of Indian markets since the start of the new fiscal year 2024-25.
Samir Arora, founder of Helios Capital, says that foreign investors (FIIs) could make over $16 billion if the market goes up by 2% on Monday, June 3.
“FIIs have more than $800 billion in Indian stocks. If the market rises 2%, they make $16 billion tomorrow,” Arora posted on social media platform X on June 2.
He added that foreign investors as a group usually don’t get squeezed, although individual funds might face issues occasionally.
Foreign investors have been selling due to the upcoming 2024 Lok Sabha elections, aggressive moves by global central banks, strong Chinese markets, and other global factors.
By the end of May, foreign investors sold Indian equities worth ₹25,586 crore, with a total outflow of ₹12,911 crore across debt, hybrid, debt-VRR, and equities. However, they bought ₹8,761 crore in debt in May 2024.
What will foreign investors do on Monday?
According to V K Vijayakumar from Geojit Financial Services, foreign investors might start buying again in June if the election results bring political stability.
Raamdeo Agrawal, Chairman of Motilal Oswal Group, told CNBC TV18 that this positive market trend is likely to last longer than just a few days, despite potential corrections or selling by FIIs.
Agrawal believes that short sellers will be pressured to close their positions by Monday or hope that actual election results might differ from exit polls. He predicts that the market could open 3-4% higher on Monday.
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