Overseas investors poured in more than Rs 20,400 crore in the domestic capital market in the first half of March, mainly driven by positive global cues. The expectation of a positive outcome from the US-China trade agreement along with US Fed’s decision to put rate hike on hold, have worked in favour of entire emerging market segment, analysts said.
In February as well, foreign portfolio investors (FPIs) were net buyers as they had invested a net amount of Rs 11,182 crore in the capital markets both in equity as well as debt segment. As per the latest data available with depositories, net inflow in the equities stood at Rs 17,919 crore, while the debt market saw an infusion of Rs 2,499 crore on a net basis, during March 1-15, period.
Together, it translates into a net investment of Rs 20,418 crore in the country’s capital markets for the period under review. “With the expectation on US interest rate hike declining, there has been increased flow into emerging markets. Locally, since February, there is a clear trend of FPIs buying beaten down segments such as banking and finance stocks…,” Vidya Bala, Head – Mutual Funds Research at FundsIndia said.
Himanshu Srivastava, senior analyst manager research at Morningstar Investment Adviser India, said it was a welcome change in FPI trend. However, some of the domestic concerns such as slow pace of economic growth and political uncertainty may come to the fore as the general election approaches in India, he added.