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FPIs turn net buyers in India cash market for first time in five months

In July, the Nifty rose 2.2% month on month to 24,383.6, helped by ₹6,732.0 crore of FPI cash inflows and the short covering of 83,297 index futures contracts.

Reported · Written up by our desk · Emerging Markets

Foreign portfolio investors turned net buyers in India’s secondary cash market in July for the first time in five months, injecting ₹6,731.97 crore since the West Asia conflict began on 28 February, LiveMint Markets reported. The buying was reinforced by domestic institutional investors, with DIIs purchasing ₹35,099 crore, while investors also covered shorts in index futures, purchasing 83,297 Nifty and Bank Nifty futures contracts. Together, this helped the Nifty gain 2.17% month on month to close July at 24,383.60. Analysts cited by LiveMint Markets said stronger foreign cash inflows and continued short covering in index futures could drive a rally toward the Nifty’s pre-war level of 25,178.65, but warned that any escalation in the West Asia conflict could derail that outlook. Kruti Shah, a quant analyst at Equirus Securities, said the easing of the West Asia situation and a shift in the global AI trade have supported FPI inflows. The article notes that the Nifty closed at 25,178.65 on 27 February, the day before the war began, and has not reclaimed that peak. It also linked the outlook to oil moves, saying Brent crude surged 24% in July to $90.12 a barrel even as hopes grew for a resolution that could pull prices closer to the pre-war level of $72.48 seen on 28 February.

Latest closeWTI crude $86.80 ▲3.8%|Brent $90.12 ▲1.2%

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