The FIIs were continuous net sellers as they purchased Rs 22,483 crore and sold Rs 27,753 crore during the period under review.
Earlier also (between January 17 and 24, 2008) they were net sellers for six consecutive days before turning into net buyers. During this period, they had sold Rs 14,355 crore ($2.99 billion) in six trading days.
Dealers explained that while the FIIs had sold more in six days compared to the current selling figure, what was striking was their behaviour, which continued to be on selling mode.
The pullout of money by the FIIs in the last eight trading days has led to a fall in the Bombay Stock Exchange (BSE) Sensex by 5.85 per cent or 1,019.37 points in last nine trading sessions from 17,434.94 on May 16, 2008 to 16,415.57 on May 30.
Such a selloff by the FIIs was last seen in May 2006 when they had offloaded shares worth Rs 11,055 crore in the equity market in 14 trading sessions. The Sensex declined by 19 per cent from 12,435.41 on May 11, 2006 to 10,451.33 on June 2, 2006.
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According to market players, the pullout has been essentially on account of the bearish sentiment on Indian economy. Higher inflation and slowdown in the industrial production data have weakened the earning potential of the companies, said a dealer.
Further, rising crude prices led to aggressive demand for dollars from Indian oil companies which, in turn, hastened the depreciation of the rupee. The rupee has lost around 8 per cent since beginning of May 2008, falling from Rs 40 to a low of 43.2.
Dealers explained depreciation as paying more rupees for dollars for conversion of rupees into the greenback for repatriation. Since the sentiment was bearish, the FIIs began to pull out in panic. While some have parked the funds temporarily in debt instruments, others have preferred to repatriate, added a dealer.