The value of net purchase of equities by foreign institutional investors (FIIs) has crossed Rs 1,000 crore in just seven trading sessions. According to figures available with Securities and Exchange Board of India (Sebi), FIIs have been investing heavily in the equities markets, and their investments are now worth Rs 1023.60 crore.
In fact, during the first three trading sessions of the month, it started on a negative note with the FIIs abandoning equity though it was in relatively small lots.
Tata TDWaterhouse Asset Management Company Chief investment officer Ved Prakash Chaturvedi said one of the main reasons for the FII inflows was the PSU disinvestment which had infused fresh activity in the equity markets. "The pace is gathering momentum and everyone wants to be a part of it," he said.
More From This Section
It is also seen as an affirmation of the government going ahead with its reforms. Also, the warlike situation which prevailed during the earlier part of the year had receded and this led to the FIIs returning in full force.
"This is usually the time when the FIIs make their fresh allocations," Chaturvedi pointed out. The government and Reserve Bank of India's notifications on ADR/GDR fungibility have also been a positive booster for the market, according to market circles.
However, market participants also said a bull rally just before budget usually signalled large-scale dumping by them just after the budget is announced. "However, this is what they always do, so this time we should be prepared for it and enjoy the rally now," said a dealer.