BENGALURU, Feb 6 Reuters Foreign portfolio investors FPI sold a record amount of Indian financials in January the sector in which they have the largest holdings after the country39;s largest lender HDFC Bank posted disappointing earnings, according to National Securities Depository data.

The monthly selling in financials, worth about 300 billion rupees, snapped the FPI buying streak in Indian equities.

FPIs sold stocks worth 257.44 billion rupees 3.10 billion in January after a record monthly buying in December.

We see FPI outflows in January as a temporary blip. They will likely turn net buyers in the next few months, said Neeraj Dewan, director at Quantum Securities.

The January FPI sale is predominantly due to the disappointment from the HDFC Bank results, which hurt sentiment, added Dewan.

FPI selling triggered a 4.61 fall in financials and a 0.03 drop in the Nifty 50 index in January.

FPIs had turned net buyers in November and the monthly purchases hit a record in December on hopes of early rate cuts in the United States.

With gains of 5.52 in November and a subsequent climb of 7.94 in December, the Nifty 50 concluded 2023 with the best monthly gains since July 2022.

While the onset of U.S. rate cuts could be delayed, resilience in the U.S. labour market and cooling inflation have strengthened the narrative that there shall be a soft landing, said Mayuresh Joshi, head of equity research India at William O39;Neil and Company.

If the demand recovery…