FPIs Became Net Buyers Of Equities So Far In January

FPIs became net buyers of equities so far in January, invested Rs 3202 crore.

Foreign investors (FPIs) infused Rs 3,202 crore in Indian equities in the first week of January after three months of selling, becoming net buyers.

During this period, the improvement in the markets has given them a good buying opportunity.

Experts said future FPIs flows will remain volatile on expectations of the US Fed rate hike, rising concerns over the Omicron variant, and rising inflation levels.

The latest inflow comes after a net outflow of Rs 38,521 crore during October-December 2021. Earlier, foreign portfolio investors (FPIs) had made a net investment of Rs 13,154 crore in September last year.

According to data available with depositories, FPIs have invested a net Rs 3,202 crore in Indian equities from January 3 to 7.

Himanshu Srivastava, Associate Director- Manager Research, Morningstar India said, “The intermittent buying by FPIs can be attributed to a correction in the markets in the interim, which has given them some good buying opportunities.

He further said that FPIs continue to be cautious in their investment approach in view of the sharp spurt in the coronavirus pandemic across the world, including in India.

Apart from equities, FPIs have been marginally net buyers in the Indian debt market. During the week, he has bought net assets worth Rs 183 crore.

The inflow of FPIs into the Indian debt markets has been sporadic for a long time and has shown no clear direction. Last year, they were net sellers of Rs 1.04 lakh crore.

VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said one of the major concerns of FPIs is the tighter monetary stance in the US, with a rise in 10-year US bond yields likely to trigger selling in emerging markets.

He added that since the Indian market is resilient, and there is a strong inflow of retail and domestic institutional investors, selling pressure on FPIs is unlikely unless the market picks up.