Building on their buying momentum, foreign investors have pumped in Rs 5,790 into the country’s capital markets within a fortnight this month, driven by global and domestic factors.
The latest infusion comes on top of a whopping inflow of Rs 25,904 in the preceding two months (July-August). Prior to that, foreign portfolio investors (FPIs) had pulled out a total of Rs 4,373 crore from the capital markets (equity and debt) in June and July.
Experts attributed the latest flurry in inflow to factors such as widespread monsoon, better corporate earnings, clearing of the Goods and Services Tax (GST) bill and positive data on the US economy.
Sentiment also rode high after domestic passenger vehicle sales grew for the 14th straight month in August and consumer inflation eased to a five-month low of 5.05 per cent for the month, mainly because of a slower rate of price increase in vegetables as well as food and beverages.
According to depositors’ data, net investment by FPIs stood at Rs 2,122 crore in equities during September 1-16, while the same for debt markets was at Rs 3,668 crore, taking the total inflow to Rs 5,790 crore (USD 871 million).
So far this year, FPIs have invested Rs 42,972 crore in equities, while withdrawing Rs 3,680 crore from the debt market. This resulted in a net flow of Rs 39,292 crore.