any country, foreign investors get badly hurt if the local currency continues to depreciates because FIIs bring in dollar to invest and take back less of it when they sell."
Another major setback for FIIs was slowing economic growth. The latest official figure showed that in 2011-12, the country's GDP growth has dropped to 6.5 per cent, and, even worse, the growth in the January-March quarter was only 5.3 per cent, lower than the economist projections.
In June so far, while foreign investors took out a total of Rs 1,067 crore from stocks, however they seem to be bullish on the debt market and poured in Rs 1,927 crore. This takes the collective net investment into stocks and bonds to Rs 860 crore during the period.
The BSE benchmark's Sensex has lost 500 points or three per cent in the first week of the month to close at 16,718.87 on Friday.
In the first three months of the calendar 2012 witnessed FIIs pumping huge capital into the equity markets, while in the the next two |
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