FII exodus: 5 sectors hit hardest by foreign fury in early February

Feb 22, 2025, 02:59:22 PM IST

Foreign Institutional Investors (FII) continued their selling spree in the Indian equity market, offloading shares worth Rs 26,610 crore across 16 sectors in the first half of February, according to NSDL data. Financial services bore the brunt of the outflows, followed by FMCG, capital goods, oil & gas, and consumer services. Meanwhile, selective buying was seen in telecom, healthcare, IT, and chemicals. The relentless foreign selling comes amid global risk-off sentiment, concerns over interest rates, and profit-booking post-Budget. Here’s a detailed look:

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The financial services sector remained the biggest casualty, with foreign investors dumping Rs 5,344 crore worth of shares in February after offloading Rs 24,949 crore in January. This brings the total outflows from the sector to Rs 58,280 crore in 2024. Banks and NBFCs were hit the hardest, given their dominant weight on the Sensex and Nifty. Rising concerns over asset quality and global risk aversion further dampened sentiment.

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Despite the Union Budget’s focus on boosting consumption through tax cuts, FMCG stocks witnessed an outflow of Rs 4,336 crore in February. This follows Rs 5,428 crore of selling in January. While expectations were high for a demand revival, foreign investors chose to book profits after the initial rally, indicating scepticism over sustained demand recovery.

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IANS

Consumer services stocks saw an outflow of Rs 2,262 crore in February, following Rs 8,347 crore in January. While the Budget’s focus on boosting discretionary spending was expected to help the sector, investors remained cautious, possibly due to stretched valuations and concerns over a slowing urban consumption trend.

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