Bloomberg News

Foreign Funds Buy Net 2.52 Billion Rupees of Indian Equities

September 29, 2011

Sept. 29 (Bloomberg) -- Overseas investors bought a net 2.52 billion rupees ($51.5 million) of Indian stocks yesterday, reducing their outflow from equities this year to 2.92 billion rupees, the nation’s market regulator said.

Foreigners bought 27.4 billion rupees of shares and sold 24.9 billion rupees, the Securities and Exchange Board of India said today. They bought a net 906 million rupees of bonds, raising total flows into debt this year to 179.6 billion rupees.

The BSE India Sensitive Index has dropped 18.6 percent this year, on concern a slowdown in the U.S. and Europe’s debt crisis may erode company profits already threatened by the most aggressive interest-rate increases among major Asian economies.

Overseas funds withdrew a net $2.4 billion from Indian stocks in August, the most since October 2008, according to data from the nation’s regulator. That caused the Sensex to decline 8.4 percent last month, making the gauge’s worst August in at least a decade, according to Bloomberg data.

India’s $1.3 trillion stock market, Asia’s fourth-biggest, is influenced by foreign fund flows. Inflows from abroad surged to a record $29.4 billion in 2010, making the Sensex the best performer among the world’s top 10 markets. The largest-ever outflow in 2008 led the biggest annual slump of 52 percent.

Foreign funds have placed 4.468 trillion rupees in stocks and 966.2 billion rupees in bonds since they were allowed into the country in 1993.

The regulator provides data on shares bought and sold by large investors, including trades in the primary and secondary markets, with a delay of at least a day.

--Editor: Abhay Singh

To contact the reporter on this story: Paresh Jatakia in Mumbai at pareshj@bloomberg.net

To contact the editor responsible for this story: Arijit Ghosh at aghosh@bloomberg.net


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