Foreign Investors Show Renewed Interest in Indian Equities Amid Global Uncertainties

Foreign portfolio investments in Indian equities saw net inflows of Rs 1,209 crore from June 16 to June 20, despite overall monthly outflows. Market experts credit this to strengthening economic indicators and strategic investments during block deals and FTSE rebalancing, hinting at potential stability in FPI sentiments.

Foreign investment in India's equity market showed promising signs from June 16 to June 20, recording net inflows of Rs 1,209 crore, according to the National Securities Depository Limited (NSDL). Despite a decrease from the previous week, these inflows were bolstered by significant activities on Wednesday and Friday.

Experts attribute the trend mainly to foreign participation in block deals and substantial inflows linked to FTSE rebalancing. Siddhartha Khemka, Head of Research, Wealth Management at Motilal Oswal Financial Services, observed that India's robust economic growth, low inflation rates, a recent RBI rate cut, and expectations of a favorable monsoon are driving investor confidence.

Nevertheless, June's net outflows remain negative at Rs 4,192 crore—improving from Rs 5,402 crore the previous week, indicating potential sentiment stabilization. Khemka noted that domestic and global factors, including geopolitical developments and macroeconomic signals, will dictate upcoming FPI trends. May was a positive month with Rs 19,860 crore in net inflows, as earlier volatile months witness large outflows.

(With inputs from agencies.)