Foreign portfolio investors (FPIs) have remained buyers during the trading session so far in the month of April. FPI invested till 13 April 8,767 crore in Indian equities. FPIs are expected to continue this trend, however, their appetite for IT stocks may wane after tech giants like TCS and Infosys missed Street estimates in Q4FY23. Further buying is expected in capital goods, financials and construction stocks.
As per NSDL data, FPIs invested 8,767 crore in Indian equities So far in the month of April. On the other hand, they are net sellers in the debt market Withdrawing Rs 1,025 crore 200 crores and 193 cr from debt-VRR and hybrid instruments.
Last month FPI had invested 7,936 crore in Indian shares.
FPI inflows into the overall domestic market remain positive on the back of impressive buying in equities. 7,349 crore despite selling in other instruments so far in April.
Notably, April has seen two holiday-shortened week trading sessions and FPIs have shown resilient affinity for equities despite fewer trading days.
Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said, “India has been one of the best investment destinations for FPIs in emerging markets in April so far. The correlation between FPIs and the market has become very important.”
“FPIs remained consistent buyers in the market during the last ten trading days and continued to gain in the market during the last nine trading days. Buying and short covering by FPIs are driving the current uptrend,” he added.
Overall, FPIs are net sellers in the equity market due to heavy selling in the first two months of 2023 (January to February). However, after buying in March, FPIs continued to invest in April as well, offsetting some of the equity losses. So far in 2023 the outflow was around 17,443 crore in Indian equity.
The markets have been on a 9-day rally, the longest since October 2020. They have been green all the days of April.
From March 29 to April 13, the Sensex gained over 2,817 points or 4.9%. While the Nifty 50 jumped over 876 points or 5.2%.
Last week, the Sensex closed at 60,431 on Thursday, up 38.23 points or 0.06%. The Nifty 50 closed at 17,828, up 15.60 points or 0.09%. it stock Following key Q4 earnings. It would be strong buying in banking and auto stocks that pulled Sensex and Nifty 50 out of the bears’ grip. Additionally, expectations of further pause in RBI repo rate following softening in domestic CPI also boosted sentiment. However, the FOMC minutes, pointing to a ‘mild recession’, led to cautious betting.
Going forward, Vijayakumar said, “Global market building has also been positive. FPIs are sellers in capital goods, construction & FMCG & IT and oil & gas.”
According to a Geojit strategist, there is likely to be more selling in IT in the coming days as fourth quarter results from TCS and Infosys indicate that growth prospects for the segment appear weak. Indications are that there is a possibility of more buying in capital goods, financial and construction related sectors
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