FPIs Remain Bullish In Indian Equities, Infuse Rs 30,772 Crore In July So Far

Experts noted stated that financial services sector witnessed a major lack of buying, resulting in the poor performance of the sector in the month so far

Foreign portfolio investors continued trading in July with an optimistic outlook. The investors infused Indian equities with funds worth Rs 30,772 crore in the month so far, backed by anticipation of sustained policy reforms, consistent economic growth, and an earnings season which has been faring better than expectations. 

During the same period, as of July 19, the investors poured in Rs 13,573 crore in the Indian debt market, official data from the depositories revealed. In the year so far, the investors have injected Rs 82,197 crore in the year so far. Prior to the inflow, the FPIs injected Rs 26,565 crore in equities in June backed by the political stability following the general elections, reported PTI.

Himanshu Srivastava, Associate Director - Manager Research, Morningstar Investment Research India, noted, “The anticipation of a reform-oriented budget has also lifted investor sentiment.”

Sharing the outlook for fund flows, V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said, “Going forward, if the recent trend of weakness in dollar and bond yields persists, FPIs are likely to continue their buying in the market. Domestic and foreign investors are keenly watching for possible tweaks in the long-term capital gains tax in the Budget to be presented on July 23.”

Srivastava added that the third consecutive tenure for the NDA government has left a positive impact on the sentiment in the market. “It has raised expectations for continued policy reforms and sustained economic growth. Additionally, the better-than-expected earnings season so far has also worked towards building investor confidence,” the expert shared.

In the month so far, the investors remained buyers in autos, healthcare, IT, telecom, capital goods, and oil and gas sectors. Vijayakumar further stated that financial services sector witnessed a major lack of buying, resulting in the poor performance of the sector in the month so far.