FPIs Invest ₹30,918 Crore In August

Foreign portfolio investors (FPIs) remained net buyers of Indian equities for the second consecutive month, purchasing shares worth ₹30,918 crore in August up to August 29.

The total investment was split between stock exchanges, which accounted for ₹18,790 crore, and the 'primary market and others' category, which accounted for ₹12,128 crore.

According to Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments Ltd, the return of foreign investors has been supported by a reversal in the chip trade, stability in the rupee, and improving corporate earnings growth in India.

FPIs have also shown a growing preference for small- and mid-cap stocks, commonly referred to as SMIDs, due to their stronger growth and earnings momentum compared to large-cap stocks.

Domestic institutional investors (DIIs) played a crucial role in absorbing foreign institutional investor selling pressure, purchasing shares worth around ₹5,184 crore on Friday.

On a month-to-date basis, FIIs remained marginal net buyers at around ₹454 crore, signalling a shift following several months of sustained foreign selling.

The Indian equity markets remained cautious during the week due to concerns over global interest rates, geopolitical uncertainty, and volatility linked to the new Closing Auction Session (CAS).

The benchmark indices, Nifty and Sensex, ended lower for a third consecutive week, despite recovering sharply on Friday.

The Nifty declined around 0.31 per cent during the week to settle at 24,175.65, while the Sensex slipped nearly 0.36 per cent to 77,264.51.

The introduction of CAS for futures and options stocks also remained in focus after monthly derivatives expiry witnessed sharp closing-auction price movements.

Meanwhile, broader markets showed resilience, with mid-cap and small-cap indices gaining during the week, supported by domestic liquidity and stock-specific buying.

This trend could continue, with FPIs expected to remain net buyers of Indian equities in the coming months.

The investment by FPIs is a positive sign for the Indian economy, indicating a growing confidence in the country's corporate sector.

The stability in the rupee and the reversal in the chip trade have also contributed to the increase in FPI investments, making Indian equities more attractive to foreign investors.

Overall, the investment of ₹30,918 crore by FPIs in August is a significant development for the Indian equity markets, and it will be interesting to see how this trend continues in the coming months.

The Indian equity markets are expected to remain volatile in the short term, due to global economic uncertainty and geopolitical tensions.

However, the long-term outlook for the Indian economy remains positive, driven by the country's strong demographic profile, growing middle class, and increasing investments in infrastructure and technology.

The investment by FPIs is a testament to the growing confidence in the Indian economy, and it is expected to continue in the coming months, driven by the country's strong fundamentals and growth prospects.

In conclusion, the investment of ₹30,918 crore by FPIs in August is a significant development for the Indian equity markets, and it is expected to continue in the coming months, driven by the country's strong fundamentals and growth prospects.