Foreign Investors Inject Over ₹3,300 Crore into Indian Markets Amid RBI Rate Cut

This week, foreign portfolio investors have significantly boosted their investments in the Indian stock market, injecting over ₹3,300 crore. This surge follows the Reserve Bank of India's recent decision to cut the repo rate, which has been interpreted as a strong signal to support economic growth. Despite some volatility in the markets due to global events, India remains an attractive destination for foreign investments. The article delves into the implications of these developments and the factors influencing investor sentiment.
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Foreign Investors Inject Over ₹3,300 Crore into Indian Markets Amid RBI Rate Cut

Foreign Investment Surge in Indian Stock Markets


New Delhi, June 14: This week, foreign portfolio investors (FPIs) infused ₹3,346.94 crore into the Indian stock markets, buoyed by heightened investor confidence following a recent rate cut by the Reserve Bank of India (RBI).


Data from the National Securities Depository Limited (NSDL) indicates that FPIs were significant buyers in the Indian equity market during the initial three trading days of the week, from June 9 to June 13.


The market's optimistic sentiment was primarily fueled by the RBI's decision to lower the repo rate by 50 basis points to 5.5 percent, which many interpreted as a clear indication of the central bank's commitment to fostering economic growth and enhancing market liquidity.


Market analysts suggest that this unexpected rate reduction has been pivotal in attracting foreign investments, showcasing a pro-growth stance from the RBI.


The Monetary Policy Committee's (MPC) resolution on June 6 has been positively received by investors, who view it as a timely measure to bolster the economy and enhance corporate profitability.


Despite ongoing global influences impacting market dynamics, India continues to be a compelling destination for foreign investments, thanks to its robust fundamentals, supportive policies, and a burgeoning economy.


In May, foreign investors contributed ₹19,860 crore to the Indian stock market, marking it as the most successful month of the year for foreign investment.


However, analysts noted that Indian equity markets experienced heightened volatility this week, ultimately closing lower.


The week commenced positively due to advancements in US-China trade discussions, but that optimism quickly diminished following Israel's military action against Iran's nuclear sites.


This incident instigated a wave of caution among global investors, prompting a shift towards safer assets such as gold and US bonds.


Additionally, oil prices surged past $76 per barrel, breaking a period of stability as new concerns regarding supply disruptions arose.


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