Mumbai, Nov 15 (IANS): The growing volatility in the US and European markets after unpleasant jobs data coupled with levies on financial institutions for wrongdoing led foreign investors back to Indian shores in the previous week.
On a week-on-week basis, the foreign inflows increased by 28.61 percent at Rs.5,674.21 crore reported for the week-ended Nov 14 from Rs.4,411.93 crore in the previous week ended Nov 7.
International volatility after five banks -- Citibank, HSBC, JPMorgan, RBS and UBS -- were ordered by the supervisory authorities in the US, Britain and Switzerland to pay 3.3 billion dollars in penalties for manipulating currencies soared international investors' sentiments.
Further, sentiment were lackluster due to weaker than expected job growth in the US for the month of October. European markets declined after a mixed U.S. jobs report muddied the outlook for U.S. interest rates.
The modest reaction on data out of China, with reports from Chinese customs showing stronger than expected export growth in the month of October, magde for positive global cues.
For the week ended Nov 15, the FPIs massively bought stocks worth Rs.5,674.21 crore or $922.4 million, according to data with the National Securities Depository Limited (NSDL).
For the week ended Nov 7, the FPIs massively bought stocks worth Rs.4,411.93 crore or $718.51 million.
On Nov 14, Friday the FPIs invested Rs.683.66 crore or $111.06 million, on the back of positive sentiments regarding lower inflation numbers.
The foreign institutional investors (FIIs) along with sub-accounts and qualified foreign investors have been clubbed together by market regulator Securities and Exchange Board of India (SEBI)to create a new investor category called FPIs.
For the coming week, the FPIs are expected to stay invested as the latest set of inflation and factory output numbers is bound to lead Indian equities markets to fresh highs.
The benchmark Sensex gained 0.63 percent or 178.03 in the week ended Nov 14 from its previous weekly close on Nov 7. The index closed at 28,046.66 points, while it had ended trade at 27,868.63 points points on Nov 7.
Latest data on inflation and factory output has given hope to the market that the RBI may ease its key interest rates in its monetary policy review scheduled for December 2014.
India's annual wholesale inflation rate dropped to its lowest level in five years, figures released Friday showed.
According to the data on official wholesale price index (WPI) released by the government, the inflation stood at 1.77 percent in October from 2.38 percent in the previous month and 7.24 percent for the like month of the previous year.
The annual food inflation actually declined by 1.3 percent due to a drop in the prices of fruits and vegetables, some lentils and coarse cereals. But prices of fish, eggs, mutton moved up.
On Wednesday, data showed that the country's factory output grew at 2.5 percent in September while retail inflation slipped to a record low of 5.52 percent during October.