FII inflow into stock markets crosses $10 bn mark

Betting high on Indian equities again, foreign investors have poured in over $1.67 billion this month in the stock market, taking their total investments so far this year to more than $10 billion.
Foreign investors, who had pulled out Rs 1,957 crore from the Indian stock market in the past three consecutive months (April-June), have infused $1.67 billion (about Rs 9,255 crore) till July 20, according to data available with the Securities and Exchange Board of India.
Total investment in 2012 so far by Foreign Institutional Investors (FIIs) in to the Indian equity market stood at $10.17 billion (Rs 51,248 crore), Sebi noted.
FII's new found faith for India, however, failed to cheer the broader market as the BSE 30-stock index, Sensex, settled the week ended July 20 with a loss of 120.41 points at 17,158.14.
According to experts, the nearly Rs 2,000 crore outflow in the April-June quarter was mainly due to concerns of weak economic growth and the depreciating rupee.
With Prime Minister Manmohan Singh taking additional charge of the finance portfolio, investors are re-looking at the Indian equity market. Hopes are high that the government will initiate fresh reforms initiatives, market experts said.
Besides, investors hope that the government will initiate a few key reforms before the start of the Monsoon Session of Parliament on August 8.
Experts cautioned, however, that inflows will continue to sustain only if all the policy talk translates into action.
During July 3-20, FIIs were gross buyers of shares worth Rs 34,611 crore, while they sold equities amounting to Rs 25,357 crore, translating into a net investment of Rs 9,255 crore ($1.67 billion).
Foreign funds have also infused Rs 1,514 crore ($272 million) in the debt market so far this month.
FIIs had mostly stayed away from Indian equities in 2011.
They flocked the debt market last year with a net investment of Rs 20,293 crore, while pulling out Rs 2,812 crore from equities.
As on July 20, the number of registered FIIs in the country stood at 1,752 and total number of sub-accounts were 6,350 during the same period.

Courtesy: Business Standard