Foreign investors poured over R5,000 crore into Indian stocks in a fortnight, mainly on hopes of a strong mandate for the government to be elected in polls starting next month.
Foreign institutional investors (FIIs) were gross buyers of shares worth R42,035 crore and sellers of stocks to the tune of R36,967 crore till March 14, resulting in a net inflow of R5,068 crore ($828 million), according to data with the Securities and Exchange Board of India.
FIIs also infused R14,140 crore ($2.3 billion) in the debt market during the period.
According to market analysts, a sharp drop in the current account deficit and easing inflation, which bolstered expectations that the economy will see a turnaround soon, as well as hopes for a strong mandate for the next government prompted overseas investors to pump in money in equities.
Finance minister P Chidambaram, earlier this month, said the fiscal and current account deficits were under control and the economy was more stable than it was 18 months ago.
Foreign investors have sidelined their concerns of further tapering by the US Federal Reserve.
FIIs, the major drivers of the Indian stock market, have helped push the benchmark BSE Sensex almost 690 points, or 3.26% so far this month.
Overseas investors have purchased a net R7,186 crore of stocks so far in 2014. They invested a net R1,404 crore in equities in February and R714 crore in stocks in January.
As of March 14, there were 1,719 registered FIIs in the country and 6,318 sub-accounts.
Top 4 cos lost R41,564 cr last week; TCS, Infosys worst hit
Mumbai, March 17: Dragged down by IT majors TCS and Infosys, the combined market valuation of top four Sensex companies declined by R41,564 crore last week. While TCS, Infosys, Coal India and Wipro saw losses in their market capitalisation for the week ended March 14, others, including RIL, ONGC and ITC, made gains. Infosys' value plunged R20,184 crore to R1,94,634 crore, taking the biggest hit among the top-10 companies in the domestic market capitalisation chart. The m-cap of TCS tumbled R16,443 crore to R4,19,393 crore while Wipro lost R4,558 crore to R1,34,901 crore. Similarly, Coal India's value fell by R379 crore to R1,66,657 crore. In contrast, among the gainers, ITC added R7,509 crore to R2,75,724 crore while the value of ONGC surged R6,203 crore to R2,76,085 crore. The market cap of RIL rose by R5,526 crore to R2,86,378 crore while HDFC Bank's valuation zoomed R4,879