In a slight trend reversal, foreign portfolio investors have turned sellers in the debt market, offloading bonds worth nearly $400 million in the five sessions to August 20. This follow purchases of $854.48 million till August 10 and $104 million in July. The equity market too has seen foreign funds selling stocks and in August so far they have sold a small amount of $141 million. Market watchers believe some of the selling has to do with the weakening domestic currency. On August 16, the rupee closed at its lowest ever at 70.1575. This month so far, the rupee has lost 2.03% against the dollar and has given up 8.52% since January. The weakening rupee could prompt foreign investors to offload more bonds, market observers said, since otherwise their portfolios would continue to lose value. C Venkat Nageswar, deputy managing director, State Bank of India (global markets), said the level of 70.5 might not be breached. \u201cThat is a strong resistance level while 69 figure will be a strong support level,\u201d Nageswar said. The US dollar index \u2014 the Dollex \u2014 has moved up from 94.661 to 95.146 levels since the start of August. Other emerging markets (EM) currencies too have lost value against the dollar since January. The Chinese yuan has given a negative return of nearly 5% while the Turkish lira has lost 37.6%. Barring Mexico\u2019s peso and Colombia\u2019s peso, all EM currencies have yielded a negative return this year. Analysts at Nomura pointed out that the first few sessions in August had indicated strong inflows in central government debt though some outflows were seen from corporate debt. However, that trend seems to be reversing somewhat. Meanwhile, bond yields have hardened by 13 basis points (bps) in August alone to 7.82% after the Reserve Bank of India (RBI) raised the repo by 25 basis points to 6.5% on August 1. This followed a 25 bps hike in the repo in June. The central bank, however, retained its neutral stance. Crude oil prices have increased by over a dollar per barrel this month and are currently hovering around $73.80 levels per barrel.