FIIs turn net sellers in bank, financial services stocks in November; dump USD 210 crore, highest since March 2020

The Foreign Institutional Investors (FIIs) play an important role while deciding the course of the Indian markets. In November, the FIIs have turned sellers with banking and financial stocks being dumped most during the second last month of 2021, a Zee Business report said. 

The foreign investors dumped $210 crore in banking and financials in November, making it the highest FII outflow month since March 2020 for bank and financial shares. 

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The FIIs in November had sold a total of Rs 39,900 crore, in which banks and financials were at the front, along with IT Services, NBFCs, Oil & Gas, FMCG, and Pharma. 

According to Zee Business research analyst Devanshi Ashar, the selling in banks is mainly seen as a threat of increasing competition from FinTech firms and concerns about increasing competition in the lending business and also due to fears that Omnicron could hit the asset quality of banks.  

Besides, banking and financials, the highest outflow was seen in Oil & Gas $63.4 crore as the crude oil prices witnessed a free fall of 13 per cent in a single day on virus scare. Moreover, the decision to release oil, by the US and other nations from the strategic petroleum reserves also spooked prices. 

Similarly, the Metal & Mining and IT Services also saw the highest outflow $41 crore and $36.6 crore respectively mainly hit by weak global demand concerns. On the contrary, the highest inflow in November is witnessed in FMCG $273 crore and Realty $52.4 crore.  

With almost every week an initial public offer is being launched, the foreign investors have been enthusiastic about IPOs. The Rs 3,745.65 inflows witnessed in the primary market during the November month, highest so far in 2021.