FIIs pour in ₹7,831 crore, extend November buying spree as markets rally

Foreign institutional investors (FIIs) extended their strong buying streak in Indian equities on Thursday, making net purchases worth ₹7,830.60 crore on a provisional basis. Domestic institutional investors (DIIs), meanwhile, turned net sellers, offloading equities worth ₹6,331.17 crore.

According to provisional exchange data, FIIs bought shares worth ₹20,273.32 crore and sold equities worth ₹12,442.72 crore, taking their net investment to ₹7,830.60 crore. DIIs purchased shares worth ₹15,855.13 crore but sold shares worth ₹22,186.30 crore.

The latest buying comes as foreign portfolio investors (FPIs) return to Indian equities after remaining underweight for several months. With just eight full trading sessions completed in November, inflows are already on course to surpass previous monthly records if the momentum sustains.

Foreign buying has gathered pace over the past week, coinciding with a sustained rally in benchmark indices.

Indian equity markets extended their gains for a third consecutive session on Thursday, with the Nifty closing just shy of the 25,300 mark. The Sensex rose 31.6 points to settle at 81,911, while the Nifty gained 44.3 points to close at 25,299.

The Nifty Bank outperformed the frontline indices, advancing 726 points to end at 61,518.5, moving closer to its record high. All its constituent stocks ended in positive territory, while the Nifty Midcap index gained 520 points to settle at 62,039.

The scale of foreign buying is particularly notable when compared with previous periods of heavy FPI inflows. November and December 2020, in the aftermath of the pandemic-induced market crash, were among the most significant recent periods of foreign investment. FPIs invested $9.6 billion and $7.3 billion in Indian equities in those respective months.

The latest buying suggests renewed interest among foreign investors in Indian equities. However, Thursday's provisional figures also highlight a divergence in institutional activity, with domestic investors taking the other side of the trade.

Where did FIIs invest in October?

Last month, financial services, fast-moving consumer goods (FMCG) and automobiles bore the brunt of foreign selling. FIIs recorded net outflows of $2.2 billion from Indian equities in October, according to Motilal Oswal Financial Services (MOFSL), although the withdrawals were lower than those seen in September.

Financial services and FMCG each witnessed foreign outflows of around $1 billion, while the automobile sector saw withdrawals of $800 million.

Technology, however, emerged as the most preferred sector, attracting $1.4 billion in foreign inflows during October, according to MOFSL's sector-wise analysis.

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