Retail investors acting like shock absorbers in stock market: Sitharaman

Amid continuing volatility in the stock market, FM Nirmala Sitharaman said retail investors seem to act as shock absorbers even when foreign portfolio investors went away

Amid continuing volatility in the stock market, Finance Minister Nirmala Sitharaman on Tuesday said retail investors seem to act as shock absorbers even when foreign portfolio investors went away.

Speaking at an event of the corporate affairs ministry as part of the Azadi ka Amrit Mahotsav, Sitharaman said that during the pandemic, there has been a very significant increase in retail investor numbers.

"Retail investors have come in a big way that they seem to act like shock absorbers... if FPIs went away, our markets did not really have to show their ups and downs in a very distinct way because small investors in the country have come in a big way," she said.

Sitharaman is also in charge of the corporate affairs ministry.

In March, the Central Depository Services (India) Ltd said the number of active Demat accounts opened with it touched the six crore mark.

In recent months, the stock market has been witnessing significant volatility and foreign portfolio investors going on a selling spree amid tightening monetary policy actions to curb rising inflation and geopolitical tensions.