Foreign inflows cross Rs 1 lakh crore |
Domestic mutual funds and foreign portfolio investors (FPIs) are taking the capital markets to new peaks on a daily basis despite the contrarian play by insurance companies. Investments by bullish foreign inflows have crossed Rs 1 lakh crore in calendar year 2017 so far with domestic funds, aided by a spurt in systematic investment plan (SIP) kitty, also playing big bulls. While insurance companies pulled out over Rs 10,000 crore in the fourth quarter alone, FPI investments in both equity and debt markets have touched Rs 108, 484 crore in 2017. Debt market has attracted the maximum inflows of Rs 62,301 crore while equity got Rs 46,182 crore in 2017. The increase in inflows in 2017 is significant as calendar year 2016 witnessed outflows of Rs 23,000 as US Fed indicated rate hikes. If the FPI trend continues in the remaining part of 2017, inflows could overtake Rs 256,213 crore investment in 2014. However, mutual funds and insurance companies showed a divergent trend in their investment pattern. When taken together, domestic investments by mutual funds and insurance companies in the fourth quarter of FY17 were largely muted with an inflow of $ 0.2 billion. A closer look reveals divergent trends: Mutual funds invested $ 1.2 billion (around Rs 9,000 crore). However, it was more than offset by insurance companies which pulled out $ 1.4 billion (over Rs 10,000 crore).
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