Page 26 - The Indian EYE 072823

BUSINESS EYE JULY 28, 2023 | The Indian Eye 26

India stocks continue to rise and touch new

highs with inflow of investor funds

Foreign portfolio investors (FPIs) have remained net buyers in Indian stock markets for the fifth straight

month, according to data from the National Securities Depository

OUR BUREAU
Mumbai/New Delhi
here is nothing that seems stop-
ping the current rally in Indian
Tstock indices even as several
analysts lately have been pointing to
high stock valuations.
The indices touched yet another
fresh high on Wednesday morning
and the benchmark Sensex was just
at a touch short of 67,000 mark. Sen-
sex was 0.3 per cent higher at 66,992
points and Nifty 0.2 per cent higher
at 19,793 points at the time of writing
this report. In the past one-month,
they cumulatively gained about 6 per-
centage points.
Several analysts have pointed out
that any further rally from the current
levels is unlikely as valuations are high-
er. The consistent inflow of foreign
portfolio funds, firm economic out-
look, firm global markets, and a rela-
tive moderation in inflation contribut-
ed to the latest bull run in Indian stocks.
“The market continues to be re-
silient supported by favorable global The indices touched yet another fresh high on Wednesday morning and the benchmark Sensex was just at a touch short of 67,000 mark (ANI)
set-up and sustained FII inflows. It is
important to understand that the on-
going global market rally is primarily vices, Nifty media, Nifty PSU bank, have remained net buyers in Indian down of other banks.
driven by the strength of the US econ- Nifty consumer durables, and Nifty stock markets for the fifth straight Notably, in January and Febru-
omy, which is, so far, showing no signs oil and gas rising the most. month, according to data from the Na- ary, FPIs sold equities worth Rs 28,852
of recession that the markets had In the past month, the indices tional Securities Depository (NSDL). crore and Rs 5,294 crore, respectively.
feared and discounted in 2022. The – Sensex and Nifty -- cumulatively The foreign funds making their NSDL data showed. Foreign investors
recent corporate results from the US gained about 6 percentage points. way into Indian stocks buoyed the were apparently cautious amid risks
have been better-than-expected en- Several analysts have pointed out broader market as the indices have from the then-volatile financial markets.
abling continuation of the rally,” said that any further rally from the current been touching their respective fresh Barring some exceptions includ-
VK Vijayakumar, Chief Investment levels is unlikely as valuations are higher. peaks every now and then. Notably, ing the current one, foreign portfolio
Strategist at Geojit Financial Services. The consistent inflow of foreign Sensex today too touched its all-time investors (FPIs) had been selling eq-
Considering what he termed as portfolio funds, firm economic out- high of 66,311 points. uities in the Indian markets for over
high valuations, Vijayakumar added look, firm global markets, and a rela- The latest fund inflows started af- a year, which started in October 2021
investors may consider some profit tive moderation in inflation contribut- ter the recent banking crisis in the US, for various reasons.
booking “if that helps in the realiza- ed to the latest bull run in Indian stocks. leading to the Silicon Valley Bank’s In 2022, foreign portfolio inves-
tion of some planned financial goals.” Foreign portfolio investors (FPIs) closure, among others, in March. Also, tors sold Rs 121,439 crore worth of
But Indian stock indices traded have remained net buyers in Indian India’s strong economic outlook, as stocks in India on a cumulative basis,
marginally lower Thursday morning, stock markets for the fifth straight forecasted by various global agencies, the data available on the NSDL web-
primarily due to profit booking after month, according to data from the Na- seemed to have made a renewed ap- site showed.
the latest bull run. tional Securities Depository (NSDL). petite for domestic stocks. Tightening monetary policy in
Sensex and Nifty were 0.2 per FPIs bought Indian stocks worth Rs One of the most prominent lend- advanced economies including rising
cent lower. The indices touched yet 7,936 crore, Rs 11,631 crore, Rs 43,838 ers in the world of technology start- demand for dollar-denominated com-
another fresh high yesterday and the crore, and Rs 47,148 crore in March, ups, Silicon Valley Bank, which had modities, and strength in the US dollar
benchmark Sensex in the process April, May, and June, respectively. The been struggling, collapsed on March had then triggered a consistent outflow
crossed the 67,000 mark. All the Nif- trend is also firm in July as they bought 10, after a run on the bank by the de- of funds from Indian markets. Inves-
ty sectoral indices were in the green, Rs 36,971 crore worth of equities. positors. Its closure led to a contagion tors typically prefer stable markets
with Nifty bank, Nifty financial ser- Foreign portfolio investors (FPIs) effect and the subsequent shutting in times of high market uncertainty.

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