Oil price jump and rising global yields have triggered renewed foreign selling of Indian assets, reversing recent inflows. Foreign investors have net sold $2.1 billion of Indian equities this month after two months of buying; index-eligible Indian sovereign bonds have seen $1.1 billion of net outflows and are on track for the largest monthly withdrawal since March. Higher oil is weighing on the rupee and boosting inflation, and India's heavy reliance on energy imports narrows policy room. UBS In

Oil price jump and rising global yields have triggered renewed foreign selling of Indian assets, reversing recent inflows. Foreign investors have net sold $2.1 billion of Indian equities this month after two months of buying; index-eligible Indian sovereign bonds have seen $1.1 billion of net outflows and are on track for the largest monthly withdrawal since March. Higher oil is weighing on the rupee and boosting inflation, and India's heavy reliance on energy imports narrows policy room. UBS India global markets head Gautam Chhaochharia said oil will be the key determinant of further foreign flows; UBS expects Indian equities to remain rangebound near term, with valuations, increased stock supply and high oil prices likely to cap upside.