Foreign investors return to Indian markets in Oct, investing over Rs 6,000 crore

Mumbai, Oct 19 The ongoing market rally has succeeded in attracting foreign investors back to Indian equities this October as Foreign Portfolio Investors (FPIs) have poured over Rs 6,000 crore into the equity market so far this month.

According to data from the National Securities Depository Limited (NSDL), FPIs invested Rs 6,480 crore in equities till October 17. This comes after three consecutive months of net selling by foreign investors.

In the previous months, FPIs had offloaded Rs 23,885 crore in September, Rs 34,993 crore in August, and Rs 17,741 crore in July.

Market analysts said, “The main reason behind this shift in FII strategy is the narrowing valuation gap between India and other markets.”

“India’s relative underperformance over the past year has opened up opportunities for better performance going forward,” experts added.

The past week was strong for Indian equities, with benchmark indices closing at 52-week highs. The Nifty rose 424 points, or 1.68 per cent, to close at 25,709.85, while the Sensex jumped 1,451.37 points, or 1.76 per cent, to settle at 83,952.19.

Among sectors, Nifty Realty led the gains with a 4.14 per cent rise, followed by Nifty Auto (1.90 per cent), Nifty Financial Services (2.59 per cent), Nifty FMCG (3.00 per cent), Nifty Infra (1.70 per cent), and Nifty Consumption (2.73 per cent).

Market analysts said, “Easing inflation, strong domestic macro fundamentals, and healthy earnings momentum provide a solid setup for the medium term. The upcoming week is packed with key events that could act as major triggers for investors.”

Analysts said that the rally was underpinned by strength in consumption-driven sectors and a broad-based recovery across realty, healthcare, and banking.

“Investor confidence was further buoyed by easing concerns around asset quality in the financial sector and expectations of improved volume growth in the festive quarter," market experts said.

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