Rescue plan may lure foreigners anew to Indian stocks

S&P BSE Sensex and the NSE Nifty50 have set fresh records as local investors ploughed money into shares

Indian equities, already among the top performers in Asia this year, may start drawing back foreigners after the government announced a $32-billion rescue for state-owned banks weighed down by bad loans.

“Foreign investors will view this very positively,” said Sageraj Bariya vice-president of sales at East India Securities. The plan “should inspire confidence in trade, industry and investors”.

Overseas funds so far in October have sold a net $1 billion of Indian stocks, cutting their 2017 inflows by 20 per cent, following the slowest economic expansion in three years. Growth concerns may ease as optimism builds that the recapitalisation plan will fill