FIIs pull out Rs 3,400 cr from debt market in past week

New Delhi: Overseas investors pulled out about Rs 3,400 crore (USD 544 million) from the Indian debt market in the past week amid concerns about the US government shutdown.

Foreign institutional investors (FIIs) were gross buyers of debt securities worth Rs 1,942 crore during October 1-4, while they sold bonds amounting to Rs 5,340 crore, a net outflow of Rs 3,398 crore.

[caption id=“attachment_1135959” align=“alignright” width=“380”]  Reuters[/caption]

FIIs pulled out a net Rs 5,600 crore of debt securities in September, according to data available with market regulator, the Securities and Exchange Board of India (Sebi).

However, foreign investors pumped in a net Rs 555 crore in the equity market in the first week of October.

Market experts attributed the weekly sell-off to global cues, including the US shutdown, even as India’s current account deficit numbers came in better than expected.

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The benchmark S&P BSE Sensex has gained 536 points, or 2.76 per cent, since September 30 and closed at 19,915.95 on October 4.

FIIs had been aggressive buyers of bonds since the beginning of 2013 on account of higher yields offered by government and corporate debt. The debt market attracted a net inflow of close to Rs 25,000 crore in January-May.

So far this year, foreign investors have pulled out a net Rs 39,974 crore (USD 6.2 billion) from the debt market.

As of October 4, the number of registered FIIs in the country stood at 1,744 and the total number of sub-accounts at 6,358.

PTI