Budget 2024: FPIs likely to stay cautiously positive on stock markets, here's why
₹13810 Crore in September and ₹17875 crore in October, as per NSDL data, the foreign portfolio Investors were net buyers in the Indian markets investing ₹8786 crore in November. It is the rising dollar index and higher US Bond yields since September that had meant that investments into emerging markets like India became less attractive for FPIs, the declining Bond yields and softening of dollar index now have been helping FPI flows into India.
Also read- Defence, railway stocks surge after BJP's state election victory FPIs have reversed their selling strategy in India as decline in U.S. bond yields and the resilience of the Indian market have forced the FPIs to halt their selling, during the last six days and FPIs were consistent buyers in India, said analysts The decline in the 10-years US bond yields to close to 4.25% after having hit 5% is positive for flows into India now.
The election outcome and rally in the India markets may further keep FPI positive and FOMO (Fear of missing out) may lead them away from selling and remaining net buyers, feel analysts The experts as Deepak Jasani Head of Research at HDFC Securities said that the FPI’s are likely to recalibrate their strategy post-Election results in a few days. While the FOMO will be an influencing factor for FPI however they will be watchful on the valuations of the Indian markets feels Jasani.
The global interest rates movement and outcome of the FOMC (Federal open market committee) meeting in coming day will remain key. The Q3 results in January there will be other factors that FPI will watch before vote on account (Budget 2024) is presented.
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