The resilience of the Indian market and the expectation of a rate cut in the US led to foreign investors investing close to Rs 11,000 crore in domestic entities during the first week of the month. Foreign portfolio investors, or FPIs, have been purchasing stocks consistently since June. They had already taken out a total of Rs 34,252 crore in April and May.
According to Himanshu Srivastava, Associate Director-Manager Research at Morningstar Investment Research India, India’s stable macroeconomic situation is likely to sustain the recent promising inflows. Global elements, such as the US interest rate and the geopolitical climate, would still be significant. “This week’s significant net inflows can be ascribed to increased conjecture regarding the imminent initiation of an interest rate reduction cycle, in conjunction with enhanced outlooks for India’s economic expansion,” stated Srivastava.
According to information from the depositories, foreign portfolio investors invested Rs 10,978 crore in stocks until September 6. Since US Federal Reserve Chair Jerome Powell’s comments raised the prospect of a rate cut, FPIs have been buying wildly in the Indian equity markets.
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