Big hand of foreign investors behind the market boom


New Delhi . The last few weeks were full of hope for the Indian stock market, in fact, foreign investors have a big hand behind this good growth. Foreign portfolio investors (FPIs) have infused around Rs 5,600 crore into the Indian stock markets so far this month. The expected increase in consumer spending in the festive season is a big reason behind this. Also, the attractiveness of FPIs to the Indian markets has increased due to stronger fundamentals as compared to other emerging markets. Earlier in August, foreign investors had invested Rs 51,200 crore in Indian equities and about Rs 5,000 crore in July.
It is clear that there has been a change in the attitude of FPIs towards the Indian markets. After nearly nine months in July, FPIs became net investors. Since then his attitude has continued. The process of withdrawal of FPIs from the Indian markets started in October last year. During October 2021 to June 2022, FPIs sold shares worth Rs 2.46 lakh crore. According to depository data, FPIs have infused a net Rs 5,593 crore into the Indian stock markets during September 1-9.
VK Vijay Kumar, chief investment strategist of a company said that FPI buying will continue in the Indian markets. If the yield on bonds in the US rises or the dollar index moves above 110, their trend could be affected. Vijayakumar said, “FPIs are buying in Indian markets because India is the best performer among the major economies. There is a slowdown in the US, the European region and China. At the same time, Jai Prakash Gupta, an agency head said, “I think whatever decision the US Federal Reserve takes on interest rates, FPI buying will continue in the Indian markets.” “The Indian markets are definitely in a good position due to the fall in crude oil prices, expectation of increased consumer spending in the festive season, better macroeconomic fundamentals,” Gupta said.
Another company’s head of equity research (retail) Shrikant Chauhan said that the Indian markets are bullish due to fall in prices and fall in domestic bond yields. Another agency’s associate director-manager research Himanshu Srivastava said that from mid-July, the attitude of FPIs towards India started changing. With inflation coming down, he expects the Federal Reserve and other central banks not to move too quickly on the interest rate front. Besides, the Indian stock market has gone through a period of ‘correction’, making valuations very attractive right now, he added. Apart from equities, FPIs have also netted Rs 158 crore in the debt or bond market during the period under review.