Foreign portfolio investors turned net buyers in the first half of September, pumping in Rs 1,841 crore into the capital markets, after remaining sellers for the previous two months.
The latest inflows have been triggered by improving investor sentiment on the back of easing U.S.-China trade war and supporting macroeconomic data, experts said.
According to the latest depositories data, foreign portfolio investors withdrew a net amount of Rs 2,031.02 crore from equities but put in Rs 3,872.19 crore in the debt segment during Sept. 3-13, translating into a total net inflow of Rs 1,841.17 crore into the capital markets.
Prior to this, FPIs pulled out a net Rs 5,920.02 crore in August and Rs 2,985.88 crore in July from the domestic capital markets (both equity and debt).
"The markets have been largely positive on back of cooling U.S.-China trade war. Besides, the July IIP came out at 4.3 percent which could have helped with the investor's sentiments," said Harsh Jain, COO at Groww.
According to Arun Kumar, head of research at FundsIndia.com, apart from the signs of improvement in U.S.-China trade relations, stimulus announcement from European Central Bank has also contributed towards bolstering sentiment.
Going forward, "India remains one of the most attractive markets for global investors in the medium to long-term and may attract significant flows, if the government continues with its economic reforms and corporate earnings show signs of recovery," said Arindam Chanda, CEO, IIFL Securities Ltd.
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