In short: On November 26, foreign institutional investors (FIIs) invested ₹1,157.70 crore in shares, resulting in a large influx and rejig of the MSCI index. MSCI index rebalancing and political stability have boosted market sentiment, with domestic institutional investors selling equities worth ₹1,910.86 crore, following a sell-off yesterday.
The MSCI rejig on November 25 included five Indian firms, Voltas, Oberoi Realty, BSE, Kalyan Jewellers, and Alkem Laboratories, triggering passive inflows estimated at $2.5 billion. This contributed significantly to the ₹9,948 crore purchased by FIIs. Analysts caution against assuming a full-fledged return of FIIs to Indian equities, as the Nifty 50 and Sensex remain under pressure.
Foreign funds shifted focus to China’s stimulus measures, focusing on cheaper Chinese equities. However, analysts believe the China growth narrative has lost momentum. Brokerage firm CLSA has reverted to an ‘overweight’ stance on India, despite significant net foreign investor selling since October.
