New Delhi, June 14
Foreign portfolio investors (FPIs) pumped Rs 3,346.94 crore into Indian stock markets this week, boosted by positive sentiment after the Reserve Bank of India (RBI) announced a rate cut, according to data from the National Securities Depository Limited (NSDL).
The rate cut by the RBI supported investor confidence and led to strong FPI inflows for the first three trading sessions of the week from June 9 to June 13. However, geopolitical tensions between Israel and Iran weighed on investor mood toward the end of the week.
On the last trading day of the week, Friday, FPIs pulled out a significant Rs 3,275.76 crore from Indian equities. This large outflow reduced the net investment figure for the week to Rs 3,346.94 crore.
In times of geopolitical tension, such as the ongoing Israel-Iran conflict, investors tend to shift their money to safer assets like gold, which can reduce flows into emerging markets like India.
Despite the positive inflows during the week, the overall FPI investment trend for June remains negative. So far in June, FPIs have withdrawn Rs 5,402 crore from Indian equity markets, as per NSDL data.
Reserve Bank of India's Monetary Policy Committee (MPC) on June 6th announced a surprise rate cut of 50 basis points. The repo rate was reduced to 5.5 per cent, which gave a strong push to investor confidence.
Earlier in May, the net foreign portfolio investment (FPI) inflows remained in positive and stood at Rs 19,860 crore, making May the best-performing month so far this year in terms of foreign investment.
In previous months' data also showed that FPIs had sold stocks worth Rs 3,973 crore in March. In January and February, they had sold equities worth Rs 78,027 crore and Rs 34,574 crore, respectively.
— ANI
Reader Comments
This volatility shows how sensitive our markets are to global events. While RBI's rate cut was a masterstroke 🇮🇳, we need to develop more domestic institutional investors to reduce dependence on FPIs. Atmanirbhar Bharat should apply to capital markets too!
As a small investor, these sudden FPI movements make me nervous 😅. One day markets are up, next day down. RBI should consider more measures to stabilize the rupee against dollar fluctuations that often trigger these FPI moves.
The May numbers show India remains attractive despite short-term outflows. Our fundamentals are strong - young population, digital growth, and manufacturing push. Foreign investors will keep coming back. This is just temporary profit-booking.
Interesting how Middle East tensions affect our markets! Shows how interconnected the world is. Maybe India should play bigger peacemaker role there - our energy security and markets both depend on Gulf stability.
While FPIs are important, we must not overlook domestic investors. LIC and Indian mutual funds have been steady buyers. Our market shouldn't dance entirely to foreign tunes. More financial literacy campaigns needed for retail investors.
The RBI governor deserves praise for timely action ðŸ‘. But I worry if frequent rate cuts might fuel inflation later. Common people like us suffer most when prices rise. There should be balance between growth and inflation control.
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.