FPI flows into India may remain supportive for markets during 2024 feel expert
₹66135 crore in Indian equity markets during December 2023 meant that FPI were buyers worth ₹1.7 trillion ( ₹171107 crore) in the equity market during the year 2023 as per NSDL data. “Since 2024 is expected to witness further declines in U.S. interest rates, FPIs are likely to increase their purchases in 2024 too, particularly in the early months of 2024 in the run up to the General elections", as per Dr VijayaKumar, Chief Investment Strategist at Geojit Financial Services.
Also Read- Adani Group stocks rise 4% on first day of new year; what's driving the rally? 2023 has witnessed big investment by FPIs thanks to the sharp uptick in flows in December, said Vijayakumar. FPI inflows which were negative in the previous 3 months have sharply turned positive in December. The steady decline in U.S.
bond yields have caused this sudden change in the strategy of FPIs said Vijayakumar. n December, FPIs were big buyers in financial services which explains the resilience of this segment in December. FPIs also bought in sectors like autos, capital goods and telecom.
Also Read- DLF , HDFC Bank, L&T, Hero, Lupin among 17 top picks by Sharekhan for year 2024 Deepak Jasani - Head of Retail Research, HDFC Securities, also expects FPI flows to remain positive in the near term. The expectations of rate cuts in the US as per Jassani is likely to keep FPI flows positive. The factors that can influence FPI inflows however include lower than expected Q3 results.
extended disruption in the Red Sea leading to spike in inflation or a large stimulus package in China. A big China stimulus package can lead to some diversion of FPI flows to China. Milestone Alert!
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