Tuesday, November 25, 2014

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At $39.66 b, foreign portfolio flows at record high

Lokeshwarri SK / Gurumurthy K

Foreign Portfolio Investors (FPIs) have broken the record for the highest-ever purchases of Indian stocks and debt in a calendar year with a full month still to go.
They have bought (net basis) $39.66 billion of equity and fixed-income assets so far, beating the $39.45 billion in 2010.
The surge this year can be mainly attributed to the resilience of the rupee.
Even as emerging economy currencies such as the South Korean won, Brazilian real and South African rand depreciated by 4.5-6.5 per cent against the dollar, the rupee weakened by a mere 0.1 per cent this year.
The relative strength in both bond and equity markets in India compared with other emerging markets is the other reason. “India looks well placed among emerging markets given the structural reforms being undertaken by the new government at the Centre — more efficiency, total factor productivity, balance shift from public to private sector and deepening of financial markets,” says Gautam Chhaochharia of UBS in a note.
According to Bank of America Merrill Lynch’s Global Fund Manager Survey, India is the top preference for investors in both emerging and Asia-Pacific markets.
Indian sovereign bonds are attractive compared with most developed and emerging market bonds. The 10-year government bond yield of 8.15 per cent compares favourably with that of most other emerging markets (see accompanying table).
The Sensex too has trumped most other equity benchmarks in 2014, gaining 34 per cent. This is, by far, the best return among the larger emerging markets.
Foreign investors had put money into Indian stocks anticipating the Centre to give a major policy push that could improve corporate earnings.
“Markets are in love with our leader (Prime Minister Narendra Modi). We have seen that whenever there is strong leader, this attracts foreign investors,” says Ritesh Jain, Chief Investment Officer, Tata Mutual Fund.
“This was seen in Japan, Indonesia and Brazil. The same is happening in India.” However, the composition of flows this time round is different. In 2010, foreign investors were more enamoured by Indian equity, with stocks making up three-fourth of the inflows.
This year there is greater preference for debt — while stocks received $15.53 billion, debt got $24.13 billion.
And which segment of the equity market did they prefer? Total FPI holding in NSE-listed stocks was 20.1 per cent as of September 2014, up from the 18.8 per cent in September last year. This jump was predominantly in large-caps that moved up two percentage points to 22.2 per cent. In mid- and small-caps, the rise in holding was one percentage point to 14.8 per cent and 12.7 per cent, respectively.
(This article was published on November 25, 2014) 
Source: BusinessLine

FPI Inflows in Stocks Hit $1.5 Billion in November

FPI Inflows in Stocks Hit $1.5 Billion in November

New Delhi: Overseas investors have pumped in $1.55 billion in equity market so far this month, taking the total to over $15 billion since the beginning of the year.

As per the latest data, foreign investors have purchased stocks worth Rs 42,866 crore between November 3 and 14, while they offloaded shares to the tune of Rs 33,352 crore during the same period, resulting into a net inflow of Rs 9,514 crore ($1.55 billion).

Market analysts said overseas investors (foreign institutional investors, sub-accounts or foreign portfolio investors) are betting on the government's reforms agenda.

"Equity market flows have continued to remain strong. I think Indian fundamentals would show marked improvement in the next 2-3 years. Moreover with the renewed interest in stock markets both from local and global players, valuations are unlikely to come down," Ladderup Wealth Management managing director Raghvendra Nath said.

"As such, it is better to enter the market and wait for the theme to play out over the next few years than to wait for corrections," he added.

Since the beginning of the year, foreign investors have made a net investment of $15.3 billion (Rs 91,780) crore into the country's equity market.

The debt market has also seen similar trends with overseas fund inflows of $23 billion (Rs 1.4 lakh crore) since January.

From the beginning of June, FIIs (Foreign Institutional Investors) along with sub-accounts and qualified foreign investors have been clubbed together by market regulator Sebi to create a new investor category called Foreign Portfolio Investors.
Story first published on: November 16, 2014 15:28 (IST)

Source: NDTV

Foreign portfolio investors continue to invest in Indian markets

The FPIs bought shares worth Rs 4,475.87 crore during the week ended September 5. 
MUMBAI: Foreign Portfolio Investors (FPIs) continued to invest in the Indian equities market in the week ended Sep 5.

The FPIs bought shares worth $739.41 million or Rs 4,475.87 crore during the week ended September 5, according to data with the National Securities Depository Limited (NSDL).

The foreign institutional investors (FIIs) along with sub-accounts and qualified foreign investors have been clubbed together by market regulator Securities and Exchange Board of India (SEBI)to create a new investor category called FPIs.

The FPIs had remained net buyers Friday. They bought shares worth $286.54 million, or Rs 1,732.29 crore, on Sep 4, they poured in Rs 1,314.71 crore, or $216.91 million in the Indian equities markets.

The NSDL data further showed that the FPIs, continued their buying spree on Sep 2 and Sep 3 when they invested $144.05 million and $91.91 million respectively in the markets here.

The buying by FPIs made the benchmark Sensex gain 1.45 percent in the week ended Sep 5 from its previous weekly close on Aug 28. The index closed at 27,026.70 points, while it ended trade at 26,638.11 points on Aug 28.

The market made gains or remained flat during the past ten trading sessions. It only made losses on Sep 4 and Sep 5.

The markets breached the new psychological levels of 27,000-points in the Sensex and 8,000-points in Nifty during the week under review. The Sensex gained in five out of nine consecutive sessions.

On Sep 1, the 50-scrip Nifty of the National Stock Exchange (NSE) crossed the 8,000-mark for the first time and hit a record high of 8,035 points.

On Sep 2, the 30-scrip Sensitive Index (sensex) of the S&P Bombay Stock Exchange (BSE) breached the 27,000-mark for the first time.

The FPIs, had bought shares worth $3.87 billion in August, with the trade for the week ended Aug 28 at yet another record high.

This investment of $3.87 billion or Rs 23,539.61 crore too led the Indian equities markets touch new highs in August.

The FPIs had poured in Rs 13,110.42 crore or $2.18 billion in to the Indian equities market in July.

Expectations of stable GDP growth figures coupled with an overall expectation of a further reform push by the new government have led to positive investor sentiments. 
Source: TOI
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