Foreign investors rush in as mutual funds fear to tread

Meanwhile, equity MFs had increased their aggregate cash level to multi-year highs at about 5%

Chandan Kishore Kant & Samie Modak  |  Mumbai 

Mutual funds shed equities after six long months, even as foreigners continued loading up on shares, their investments climbing to a six-month high in February. Even as mutual funds dumped stocks worth Rs 78 crore in February, foreigners shopped equities worth Rs 10,000 crore, pumping up indices four per cent this month, and 12 per cent from demonetisation lows in December.  In this equity about-face, mutual funds (MFs) cling to caution in the face of lofty valuations, even as foreigners raise their game amid weak price of dollar (relative to other ...

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Foreign investors rush in as mutual funds fear to tread

Meanwhile, equity MFs had increased their aggregate cash level to multi-year highs at about 5%

Mutual fund (MFs) turned net-sellers of equities after six months, while buying by overseas investors climbed to a six-month high in February. MFs have been net-sellers to the tune of Rs 78 crore (data for two sessions awaited), while foreign institutional investors (FIIs) have pumped in close to Rs 10,000 crore into the markets in February. Benchmark indices rallied four per cent in February, extending their gains from demonetisation lows in December 2016 to 12 per cent.Equity MF managers have changed their stance to cautious as valuations have turned lofty, while FIIs have stepped up buying amid weakening of the US dollar against global currencies. Since October 2016, MFs have invested Rs 43,875 crore, at a monthly average of Rs 7,312 crore. FIIs, on the other hand, have pulled out Rs 12,150 crore at an average of Rs 2,024 crore during the same period. Following a sharp 12 per cent rally since December 26, 2016, the benchmark Sensex is now trading at 19 times its one year forward ... Mutual funds shed equities after six long months, even as foreigners continued loading up on shares, their investments climbing to a six-month high in February. Even as mutual funds dumped stocks worth Rs 78 crore in February, foreigners shopped equities worth Rs 10,000 crore, pumping up indices four per cent this month, and 12 per cent from demonetisation lows in December.  In this equity about-face, mutual funds (MFs) cling to caution in the face of lofty valuations, even as foreigners raise their game amid weak price of dollar (relative to other ... image
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