NEW DELHI: Indian equity indices extended their previous two-week bull run and traded slightly higher in early trading on Monday.
As of 9:38 a.m., Sensex traded at 57,771.50 points, up 201.25 points or 0.35%, while Nifty at 17,232.85 points, up 74.60 points or 0.43 %.
Notably, Indian equities posted their best weekly performance in the week to July 22 marking its best week since February 2021, supported by further buying, notably in banking and IT stocks, among others.
Over the past two weeks, Sensex and Nifty are up over 7% on a cumulative basis.
Foreign portfolio investors back to being net buyers in Indian equity markets after nine long months could have supported investor sentiment.
In July, REITs bought shares worth Rs 4,989 crore, according to data from the National Securities Depository (NSDL).
So far in 2022, however, they have sold a total of Rs 225,319 crore investments in India, of which Rs 212,369 came from the equity segment.
Tighter monetary policy in advanced economies, including growing demand for dollar-denominated commodities, and the strength of the US dollar have triggered a steady outflow of funds from Indian markets.
Investors generally prefer stable markets during times of high market uncertainty.
In addition, the steady depreciation of the Rupee as well as the depletion of Indian foreign exchange reserves also impacted the weak market sentiment.
“The big bright spot for the Indian market is that REITs turned bullish in July after 9 months of relentless selling. dollar is over for now,” said VK Vijayakumar, chief investment strategist at Geojit Financial Services.
“After the expected rise in financials, now capital goods, automobiles, especially the passenger and commercial vehicle segments, and some pharmaceuticals are looking attractive,” Vijayakumar added.