Indian stocks' winning streak loses momentum as foreign investors exit

The winning streak for Indian stocks is losing momentum as sentiment sours on the prospect of tighter monetary policy and smaller stimulus spending in the coming year. The Sensex has slumped 3.6 per cent since the end of September, halting a rally that ran for six straight quarters and doubled the index’s value.

Since reaching a record high in October, the gauge has approached a technical correction, with foreign investors pulling out more than $4 billion from market over the past three months. Historically high valuations have also made some analysts cautious.

India’s key equity gauges are trading at 20-21x their estimated