Foreign Institutional Investors (FIIs) have injected more than Rs 3,000 crore into Indian stocks in the first week of March as a robust monetary policy, coupled with a shrinking current account shortfall, easing inflationary pressures and hopes of a narrowing fiscal deficit improve the economic outlook of the country.
Gross equities bought by foreign investors stood at Rs 18,944 crore till March 7, 2014, while gross equities sold by them was Rs 15,869 crore, leading to a net inflow of Rs 3,075 crore, data from the capital market regulator, the Securities and Exchange Board of India (SEBI) showed.
After remaining net buyers in the Indian debt market for the first two months of 2014, overseas investors pumped in Rs 10,358 crore into Indian bonds till March 7, 2014.
The government revised downwards its fiscal deficit target at 4.6 per cent of the gross domestic product (GDP) from a previous estimate of 4.8 per cent in FY 2013-14 amid a cutback in government spending and robust dividends from cash-rich PSU.
Further, India's current account shortfall narrowed to the lowest level in four years at USD 4.2 billion or 0.9 per cent of the country's GDP in Q3 FY 2013-14 from USD 31.9 billion or 6.5 per cent of GDP in the year ago period as gold imports eased.