Foreign Portfolio Investors Are Now Buying Into Indian Stocks

Foreign Portfolio Investors have turned net buyers in Indian stocks in the month of October. For the month of October, these funds have so far net bought to the tune of Rs 6,189 crores until Oct 18, 2020.

On the other hand domestic institutions have net sold in Indian stocks to the tune of Rs 7,347 crores.

FPI buying ans selling trend of the last few days (in crores)

Date	Gross Purchases	Gross Sales	Net purchase/sale
Oct 12, 2020	Rs 6100	Rs 5485	Rs 615
Oct 13, 2020	Rs 5,797	Rs 4965	Rs 832
Oct 14, 2020	Rs 7151	Rs 6329	Rs 821
Oct 15, 2020	Rs 6544	Rs 7148	Rs -604
Oct 16, 2020	Rs 4605	Rs 5085	Rs -479

Strong global cues

Strong global cues is one of the prime reasons for net purchases in Indian stocks. In fact, US indices like the Dow Jones are now a few per centage points away from hitting record highs.

The Sensex too has now crossed the 40,000 points mark and much of the gains seen from record lows is due to the rally in IT stocks like TCS and Infosys. Apart from this Reliance Industries is one stock that has helped propel the indices very close to record highs, from the March lows.

Foreign Portfolio Investors would continue to buy into Indian stocks, as long as global cues are strong. With the sharp rally in stocks, the risk to reward ratio for buying is now not too favourable.