Surge in FPI Investment Boosts Indian Equity Markets in July

Foreign Portfolio Investment (FPI) in Indian equity markets surged by Rs 7,390 crores in the second week of July, reaching a net investment of Rs 15,352 crores for the month. Despite fluctuations earlier in the year, FPIs showed renewed confidence, pointing to India's market potential and economic outlook.

Foreign Portfolio Investment (FPI) in the Indian equity market surged by Rs 7,390 crores during the second week of July, according to the National Securities Depository Limited. Notably, the net investment by Foreign Portfolio Investors (FPIs) in July has climbed to Rs 15,352 crores. In the first week of July alone, FPIs infused Rs 7,962 crores into the Indian equity market.

Foreign institutional investors were net sellers in January, April, and May, offloading equities worth around Rs 60,000 crores. Contrarily, they turned buyers in February, March, and June, with cumulative purchases reaching Rs 63,200 crores. "The most significant feature of institutional equity flows into the Indian market is the erratic nature of FII flows and the steady growth of DII flows," noted V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. He added that domestic institutional investors (DIIs) have been consistent buyers throughout the year, unlike FIIs.

In June, FPIs became net buyers again, infusing Rs 26,565 crore into Indian equities despite initial selling early in the month following election results announcements. This came after FPIs withdrew Rs 25,586 crore in May and Rs 8,671 crore in April. "The upward trajectory in DII inflows, such as mutual funds, will support market resilience," Vijayakumar said. He also highlighted that the erratic nature of FII flows will continue to be influenced by global factors. Investors are now closely monitoring the upcoming budget by the central government, anticipating its impact on market reactions.

(With inputs from agencies.)