India stocks set for largest foreign outflows

India stocks are set for the largest monthly foreign outflows in over an year, as the deadly wave of coronavirus, which has tested the limits of the nation's health systems, has put the business recovery in doubt.

Overseas investors have sold $1.1 billion of local stocks through April 23, the biggest outflow since March last year, when the nation imposed one of the strictest nationwide lockdown in the world to curb the spread of the pandemic. With 17.6 million cases in total, the nation is now the second-worst affected country globally.

"Foreign investors are worried about the potential near-term impact on company earnings and recovery," said G Pradeepkumar, chief executive officer at Union Asset Management Co. "It is a tactical call as markets too have run up significantly and investors have decided to take some money off the table." A return of the lockdown-like restrictions on movement of people and business operations poses a threat to the economy, that is forecast to see a double-digit growth this year. With gains of just about 2 per cent, the benchmark S&P BSE Sensex is among the worst performers in Asia this year. (Bloomberg)