India beats most major markets
for large global investors to ignore, the brokerage said in a recent note. The market depth in India has also increased considerably over the last few years, with the number of stocks with a market cap of more than $1 billion nearly doubling to 500.
“The flows have largely been driven by the performance of our economy, which has done well despite geopolitical conflicts, Covid and rate action by the US Fed. Quite a lot of the growth is domesticled, and there is still scope for further improvement given the migration to urban areas,” said UR Bhat, director of Alphaniti Fintech. Bhat added that the PLI schemes and the China plus one story had helped the cause of Indian manufacturing. The massive investment in infrastructure modernisation is helping companies in the materials, real estate and construction sectors. Banks now have cleaner balance sheets with low NPAs, which augurs well for the economy.
INCLUSION IN GLOBAL BOND INDICES
FPIs have invested $14.4 billion in Indian debt, higher than all other years except FY15 and FY18. Investors have taken a shine to government bonds since September last year, anticipating India’s inclusion in global bond indices. Another $1.5 billion of FPI money has flowed into hybrid instruments, data from NSDL showed. “An interesting feature of the foreign portfolio investment in India this fiscal is the steady growth in debt investment in sharp contrast to the volatile equity investment,” said VK Vijayakumar, Chief Investment Strategist of Geojit Financial Services.
The inclusion of Indian bonds in the JP Morgan EM Bond Fund and Bloomberg Bond Index is expected to bring in around $25 billion, starting in June this year.
While inflows will continue, Vijayakumar believes a sharp surge in debt flows is unlikely, given the rise in US bond yields in the past few days. “If the differential
The benchmark indices logged gains on the last trading session of the financial year aided by positive global cues. The Sensex rallied nearly 1,200 points, intraday before closing at 73,651, up 0.9 per cent. The Nifty rose 0.9 per cent to 22,326. The indices have gained 28.6 per cent and 24.8 per cent, respectively, this fiscal, beating most other major market indices.