On February 19, 2025, the Indian stock market witnessed a divergence in investment strategies as foreign institutional investors (FIIs) engaged in selling, while domestic institutional investors (DIIs) provided support through buying. This activity highlights ongoing trends in the Indian market, where foreign investors have been net sellers for the last 5 months, withdrawing $40.5 crore in the past week alone, according to the source data.
Despite this, there's been a notable $57.3 crore investment by FIIs into Chinese equities during the same period. This shift has impacted returns, with MSCI China outperforming India, boasting a 6-month return of 28.9% and a 1-year return of 38%, while MSCI India's returns remain negative. The divergence is partly attributed to attractive valuations and government support in China, alongside a growing focus on AI.
The current trend suggests continued market volatility, with FII selling potentially leading to instability, while DII buying could help stabilize the market. (Source: Unverified News Report)