Market sentiment remained strong, driven by optimistic investor outlook and positive global cues. Key sectors such as IT, banking, and FMCG led the early gains, boosting the indices.
Before November, FPI participation in Indian stocks was lukewarm, and they had turned net sellers. They sold Rs 14,768 crore and Rs 24,548 crore in September and October, respectively.
In terms of sectors, FPIs were big sellers in financials and FMCG in February. On the debt front, FPIs have been injecting money in the debt markets for the past few months driven by upcoming inclusion of Indian government bonds in the JP Morgan Index.
Foreign portfolio investors made a net investment of Rs 13,047 crore in equities from January 1 to January 19, according to data from the depositories.
Data from depositories shows that foreign portfolio investors sold shares worth Rs 12,146 crore this month (till October 20), following net selling in September where they pulled out Rs 14,767 crore. Prior to these outflows, FPIs were consistently buying Indian equities in the last six months.
Persistent flows from FPIs have led Indian equity markets to surge to their all-time high levels.
Business news: FPIs have been continuous buyers during the last 12 trading sessions. In May, through 12th, they bought equity for Rs 18,617 crore. Financials continue to be the favourite sector of FPIs. They were buyers in capital goods and autos too.
The massive capital outflow has significantly contributed to the depreciation in the Indian rupee, which breached the 79 per dollar mark recently.
With the investments in Aug, the net FPI investment in the equities segment in 2021 now stands at Rs 54,037 cr.
As the coronavirus pandemic is triggering fears of a global recession, foreign investors have started rowing back from the Indian capital markets by withdrawing a massive over Rs 1 lakh crore in March after remaining net buyers for six consecutive months.
Foreign portfolio investors (FPI) have pulled out over Rs 1 lakh crore from the Indian capital markets in March so far amid heightened fears of a coronavirus-induced global recession. Experts believe, foreign investors are withdrawing from riskier assets and are opting for safe heavens like dollar-denominated asset classes and gold.
Overseas investors invested only Rs 6,554 crore in Indian markets on a net basis in February, as they adopted a cautious stance amid coronavirus scare, subdued economic data, and disappointing corporate earnings.
The government plans to increase investment limit of foreign portfolio investors (FPI) in corporate bonds from 9 per cent to 15 per cent, Finance Minister Nirmala Sitharaman said on Saturday.
Budget 2020 announcement: Finance Minister Nirmala Sitharaman on Saturday proposed to increase the investment limit of FPIs in corporate bonds from 9 per cent to 15 per cent.
According to the latest depositories data, foreign portfolio investors (FPIs) withdrew a net amount of Rs 17,592.28 crore from equities and pumped in a net sum of Rs 11,672.26 crore in the debt segment, translating into a total net outflow of Rs 5,920.02 crore during August 1 - 30.
This differential regime existed even prior to the 2019 Budget, the Central Board of Direct Taxes (CBDT) said, adding that it was, therefore, not the creation of the Finance (No 2) Act, 2019, or the announcement made by the Finance Ministry last week.
Seeking to make India more attractive FDI destination globally, Sitharaman had said that government would examine suggestions of further opening up of FDI in aviation, media (animation) and insurance sectors in consultation with all stakeholders.
Tax experts said that the clarification has watered down the expected benefits of the government announcement and can make return-filing very complicated. One of them said that the structure is very "ridiculously worked out" as it makes things very complex.
The rollback comes after Indian capital markets witnessed massive outflow of foreign funds in the month of July.
There has been only four occasions since 2002, when the FPI outflow had surpassed the Rs 11,743-crore-mark witnessed in July so far, all at a time of tight financial circumstances.
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