FIIs buy $3 bn of Indian shares in November, highest since March

MUMBAI: Foreign institutional investors (FIIs) invested $3 billion in Indian equities in November, the highest since March, but are likely to take further cues from the US Federal Reserve’s policy meeting later this month.

The Sensex touched a record 33,865.95 points on 7 November, and has since shed 3.05% to 32,832.94 points on 30 November. Year to date, it is up 23.3%.

The net November FII investment of $3.05 billion is the highest since the $5.1 billion in March. Their net investment so far this year stands at $8.86 billion.

“They had sold Indian stocks for a while, and events such as the recapitalisation of banks gave it further to jump back in. Also, global risk-on trade gave the much-needed impetus,” said Gautam Chhaochharia, head of research at UBS Securities India Pvt. Ltd.

“From here on, FIIs will wait and watch keeping a close eye on how oil prices move, how Gujarat election results pan out, and how the usual high-frequency data turns up,” said Chhaochharia, adding that the Union Budget in February could be another big trigger. The Gujarat state elections will take place on December 9 and 14, while counting of votes is scheduled for December 18.

Brent crude is up 12.16% for the year to date to $63.73 per barrel.

“We think markets are on a structural bull run,” said Nilesh Shah, managing director of Kotak Mahindra Asset Management Co. Ltd.

Data from Bloomberg showed that FIIs sold a net of $1.4 billion, $661.5 million, and $1.5 billion of equities of South Korea, Indonesia and Taiwan in the last one week. In contrast, they bought India shares the most in the region at $489.4 million.