FPI inflows record worth $5 billion buying Indian equities

As per the National Securities Depository data, Foreign Portfolio Investors [FPI] were major buyers of Indian equities in the first half of December , making the highest-ever purchases in a fortnight.

The low US Bond yields, expected by the interest rate cuts by the US Federal Reserve, the RBI raising India's growth forecast, and state election results setting the stage for policy continuity in 2024 have spurred buying. 

The FPI inflows were worth 427.33 billion rupees [$5.15 billion] in the first half of December. It had turned net buyers in November, after selling in the previous two months. FPI inflows in fiscal 2024 so far stood at 1.74 trillion rupees as of December 15 and were on course for the highest inflows in a fiscal year since 2021. 

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Recently, Foreign Institutional Investors were net buyers of Rs 9,239.42 crore worth of shares on December 15 as the benchmark indices closed at a fresh record high, provisional Data available on the National Stock Exchange showed. Domestic institutional investors [DII], meanwhile, sold shares worth Rs3,077.43 crore.

FIIs have now net purchased shares worth Rs 29,733.06 crore so far this month. During the same period, DIIs have net bought Rs3,182.20 crore worth of shares, according to provisional data. FIIs have snapped their three-month selling streak, over the country's strong macroeconomic fundamentals and robust uptrend shown by the domestic markets.

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The US Fed dovish stance over the interest rates cuts and fall in dollar index, along with strong FIIs buying and healthy macros, supported the positivity in Indian markets. Global cues such as the US Fed policy decision and lower crude oil prices have supported the markets. However, among domestic cues, the latest economic data as well as the rate pause by the RBI have also led to the rally. 

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