1.3 billion dollars invested in India by listed global funds
AHMEDABAD: Despite rising US bond yields and hawkish comments from the Federal Reserve, listed global funds infused $1.3 billion into the Indian equity market in September. Listed funds invested $1.3 billion in September, led by non-ETF inflows of $933 million, said Kotak Institutional Equities, which tracks inflows.
Funds dedicated to India invested $2.2 billion, led by non-ETF inflows of $1.7 billion. Global emerging market funds withdrew $574 million, led by non-ETFs at $455 million.
The increase in India's weighting comes against the backdrop of strong inflows by listed funds in domestic markets. Kotak Institutional said in a note that Asia Fund allocation to India (excluding Japan) increased from 17 percent in August to 17.8 percent in September.
At the same time, the allocation of global emerging markets funds to the Indian market rose to 16.5 percent in September from 15.8 percent in August. Asia (excluding Japan) non-ETF fund allocation to India increased from 17.4 per cent in August to 18.2 per cent in September. Non-ETF fund allocation to global emerging markets in India rose to 15.2 per cent in September from 14.8 per cent in August.
Interestingly, despite strong inflows from listed funds, the total outflow by foreign portfolio investors from domestic equities was around $500 million. Withdrawals by hedge funds and other funds were due to a shift in risk sentiment due to rising US yields.
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