A pedestrian walks past a currency exchange shop in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Foreign Investors Stay Bullish, Pump In Rs 11,096 Crore So Far In April

Foreign investors have pumped in a net Rs 11,096 crore into the Indian capital markets in April so far, driven by global and domestic factors.

Foreign portfolio investors were net buyers for the previous two months as well, infusing Rs 11,182 crore in February and Rs 45,981 crore in March. Prior to that, FPIs had pulled out a net Rs 5,360 crore from the capital markets—both equity and debt— in January.

Foreign investors ploughed Rs 13,308.78 crore in equities and pulled out Rs 2,212.08 crore from debt during April 1-12, taking the total net investment to Rs 11,096.70 crore, according to depositories’ data.

“We are seeing this positive rally since February largely due to the rising confidence in having a stable government post elections,” said Harsh Jain, chief operating officer at Groww, an online investment startup. “The fear of economic slowdown in the developed world has increased prospects of foreign money in the Indian market.”

A dovish stance by central banks globally has also contributed to this trend.

“The foreign inflows since February are due to the shift in stance on monetary policy outlook by various central banks globally,” said Himanshu Srivastava, senior research analyst, manager research at Morningstar. “This along with expectation of a positive outcome from the U.S.-China trade agreement bolstered the risk-on sentiments among foreign investors.”

India is not the only country benefiting from the global factors as the trend is similar in other emerging markets as well. India is in the midst of a general election and any surprise on the political or economic growth front could potentially reverse the ongoing trend, he said.

Also read: What India’s Top Three Mutual Funds Bought And Sold In March