NEW DELHI, Aug 17 (PTI): Improved market sentiment helped Mutual Funds (MFs) pick up shares worth over Rs 50 billion in July, making it the highest monthly inflow in six-and-a-half years.
This also marks the third consecutive monthly inflow.
Besides, MFs pumped in a staggering Rs 190 billion in the debt market during the period.
The inflow in equities last month followed net investment of Rs 33.40 billion in June and Rs 1.05 billion in May.
Prior to that, fund houses have been net sellers in the equity market since September, while they were net buyers of shares to the tune of Rs 16.07 billion in August 2013.
As per the latest data compiled by market regulator Securities and exchange board of India (Sebi), MFs purchased shares worth Rs 50.64 billion last month.
This was the highest monthly inflow since January 2008, when they had invested Rs 77.03 billion in stock markets.
Industry experts attributed the inflows in equities to improvement in market sentiments primarily due to the new government's reforms agenda. Besides, retail participation in equity schemes has increased significantly in the last few months.
"The money in equities has been coming in the past two months and mostly in the second half of May after the General election results," said a market expert.
The buying of shares in July coincided with a rise of 2 per cent in the BSE's benchmark Sensex.
Mutual funds collect money from investors and buy stocks, including IPOs (primary market) and bonds.
In the first seven months of 2014, MFs offloaded shares worth over Rs 19 billion, while they pumped in a staggering Rs 3.94 trillion in the debt market.
MFs offloaded shares worth Rs 142.08 billion last fiscal, lower than the Rs 227.49 billion offloaded in 2012-13.
The financial year ended March 31, 2014 also marked the fifth consecutive year of net outflows by mutual funds in the equities after pumping in a net amount of Rs 69.85 billion in the share market in 2008-09.
