Kshitiz Mahajan, CEO of Complete Circle, has expressed strong optimism regarding the Indian market, anticipating a significant return of foreign institutional investors (FIIs) in the second half of the current calendar year. Mahajan's positive outlook is fueled by robust Q1 earnings, healthy FMCG sector performance, strong July auto sales data, and a favorable monsoon.
India's Appeal Amid Global Market Shifts
Mahajan highlighted India as a prime destination for FIIs, particularly in the context of the global 'Anti-AI trade' phenomenon. Emerging markets like South Korea and Taiwan, which saw substantial corrections and still exhibit high valuations, contrast with India's more attractive position. He believes August could set the stage for renewed capital inflows into the nation.
This comes as FIIs ended a four-month selling streak in July, injecting approximately Rs 20,200 crore into the Indian market. This reversal signals a renewed confidence in India's economic fundamentals.
Geopolitical Easing and Market Reaction
The sentiment was further bolstered by easing geopolitical tensions. Following comments from US President Donald Trump regarding the US-Iran conflict, which he suggested might resolve within two to three months, global oil prices saw a significant dip. Brent crude oil fell 7% to $81.93, alleviating concerns over energy costs.
In response to these developments, the Indian stock markets rallied. The Sensex climbed 609 points to reach 78,704, while the Nifty gained 191 points, closing at 24,575 during the afternoon session. This upward movement reflects investor confidence in India's resilience and growth prospects.
Fresh negotiations aimed at fully reopening the Strait of Hormuz and achieving Iran's denuclearization also contributed to the positive market mood, alongside the continued reversal in the global AI trade and strong domestic earnings reports.