From The Economic Times · Akash Podishetti · · 1m 20s
Foreign Investors Return to Indian Stock Market
Five factors needed for foreign investors to return to Indian equities.
In brief
Five factors needed for foreign investors to return to Indian equities. Foreign investors will return to Indian stocks if US bond yields cool, crude prices drop, the rupee stabilizes, Q2 earnings meet valuations, and India shows better risk-reward than AI-heavy markets. Originally reported by The Economic Times.
Foreign portfolio investors turned heavy sellers
Foreign portfolio investors sold over Rs 25,000 crore of indian shares in september, the highest monthly outflow in six months.
“FPIs sold over Rs 25,000 crore of indian shares in september, the highest monthly outflow in six months”
US bond yields at 5.34%
The us 10-year treasury yield climbed to 5.34%, its highest level since 2002, after a global bond sell-off.
“The us 10-year treasury yield climbed to 5.34% last week, its highest level since 2002”
Crude oil prices hurt india
Elevated crude prices hurt india more than many peers because the country imports most of its oil requirement.
“Elevated crude prices hurt india more than many peers because the country imports most of its oil requirement”
Rupee must stabilize
A stable rupee would reduce currency risk and make indian equities easier to own.
“A stable rupee would reduce currency risk and make indian equities easier to own”
Q2 earnings must defend valuations
Companies reporting good numbers with positive management commentary are likely to attract buying.
“Vijayakumar said companies that report good numbers along with positive management commentary are likely to attract buying”
Foreign investors need better risk-reward
India needs to show better risk-reward than ai-heavy markets like south korea and taiwan for money to return.
“For money to return, india needs to show a better risk-reward than those trades”
What brings foreign investors back
Cooling of us bond yields, crude prices, rupee stability, q2 earnings and better risk-reward are needed for foreign investors to return.
“Cooling of us bond yields, crude prices, rupee stability, q2 earnings and better risk-reward are needed for foreign investors to return”
The takeaway
Foreign investors will return to Indian stocks if US bond yields cool, crude prices drop, the rupee stabilizes, Q2 earnings meet valuations, and India shows better risk-reward than AI-heavy markets.
