NEW DELHI: Foreign portfolio investors (FPIs) have continued their buying spree in the Indian stock markets into the second consecutive month, with net foreign investments amounting to Rs 32,365 crore in July, according to data from National Securities Depository Limited. This follows cumulative purchases worth Rs 26,565 crore in June.
Foreign investors’ buying activity has coincided with domestic institutional and retail investors, propelling market indices Sensex and Nifty to new highs.Notably, the Nifty index recently crossed the 25,000 mark for the first time, registering an 11 percent gain over the past three months. This surge is attributed to robust GDP growth, controlled inflation, strong domestic liquidity, and favorable monsoon conditions.
FPI activity in June and July followed smooth election results and the formation of a new government. Previously, FPIs were net sellers in the two months leading to June, but domestic institutional investors compensated by remaining net buyers.
“FPI inflows into emerging markets like India FPIs may think of pulling more money out of India since India is the most expensive emerging market now. The developments in the US economy and markets in the coming days will set the trend for FPI in August,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Vipul Bhowar, Director of Listed Investments at Waterfield Advisors, said FPIs may choose to focus on sectors benefiting from domestic reforms and growth, such as technology and infrastructure, while cautiously approaching sectors vulnerable to global economic downturns.
Milind Muchhala, Executive Director at Julius Baer India, observed mixed activity by FPIs in recent times, with alternating bouts of buying and selling.
“We have been seeing mixed activity by the FPIs in the recent past, with bouts of buying and selling, a trend which is likely to continue for some more time. Their activity will remain influenced by various factors, including the performance of the global equity markets, the movement of the dollar index, incremental geopolitical events, and opportunities in the Indian markets considering slightly elevated valuation levels,” said Muchhala.
FPIs’ engagement continues to play a significant role in the Indian stock market landscape, influenced by domestic and global economic conditions. As the market dynamics evolve, investors keep a close watch on various factors to make informed decisions.
Foreign investors’ buying activity has coincided with domestic institutional and retail investors, propelling market indices Sensex and Nifty to new highs.Notably, the Nifty index recently crossed the 25,000 mark for the first time, registering an 11 percent gain over the past three months. This surge is attributed to robust GDP growth, controlled inflation, strong domestic liquidity, and favorable monsoon conditions.
FPI activity in June and July followed smooth election results and the formation of a new government. Previously, FPIs were net sellers in the two months leading to June, but domestic institutional investors compensated by remaining net buyers.
“FPI inflows into emerging markets like India FPIs may think of pulling more money out of India since India is the most expensive emerging market now. The developments in the US economy and markets in the coming days will set the trend for FPI in August,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Vipul Bhowar, Director of Listed Investments at Waterfield Advisors, said FPIs may choose to focus on sectors benefiting from domestic reforms and growth, such as technology and infrastructure, while cautiously approaching sectors vulnerable to global economic downturns.
Milind Muchhala, Executive Director at Julius Baer India, observed mixed activity by FPIs in recent times, with alternating bouts of buying and selling.
“We have been seeing mixed activity by the FPIs in the recent past, with bouts of buying and selling, a trend which is likely to continue for some more time. Their activity will remain influenced by various factors, including the performance of the global equity markets, the movement of the dollar index, incremental geopolitical events, and opportunities in the Indian markets considering slightly elevated valuation levels,” said Muchhala.
FPIs’ engagement continues to play a significant role in the Indian stock market landscape, influenced by domestic and global economic conditions. As the market dynamics evolve, investors keep a close watch on various factors to make informed decisions.
