Foreign portfolio investors reversed their sentiment and infused Rs 11,730 crore in the Indian equities market last week. The investors turned bullish in the week ended June 14, 2024, as positive cues from the domestic and global markets drove the sentiment. Meanwhile, the investors remained optimistic about the debt market and invested more than Rs 5,700 crore in the segment in the month so far, as of June 14.
This inflow in the equities stood in contrast to the outflow of Rs 14,794 crore seen in the June 3-7 week, official data from the depositories revealed. The overall outflow in June so far stood at Rs 3,064 crore, reported PTI.
Elaborating on the investor’s movements, V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, noted, “After the roller coaster ride in the market in the first week of June, stability has returned to the market as indicated by the sharp fall in India VIX from 27 on June 4 to 12.82 on June 14. This fall in India VIX indicates the return of stability and a likely consolidation phase in the market.”
Notably, in the previous month, the FPIs dumped equities worth Rs 25,586 crore, owing to uncertainty surrounding election results, while the outflow in April stood at over Rs 8,700 crore.
“The resilience of the market and the eagerness of retail investors to buy every dip in the market will force FPIs to reduce their selling.However, if the market continues to rally, FPIs may again turn sellers in India and buyers in other markets like Hong Kong, which are very cheap compared to India,” Vijayakumar explained.
Himanshu Srivastava, Associate Director – Manager Research, Morningstar Investment Research India, stated that the lower-than-expected inflation figure in the US raised hopes of a rate cut in the year. “This also triggered a fall in the US treasury yield. These factors led to risk-taking sentiments among investors, resulting in increased flows into markets like India,” he added.
Overall, the investors took out Rs 26,428 crore from equities in 2024 so far, and infused Rs 59,373 crore in the debt market in the period.
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