Global investors returned to India’s financial stocks after a three-month selling streak, as the central bank’s recent measures to draw foreign capital ease funding constraints for lenders.
Overseas funds bought about $1.5 billion of banking and financial-services shares in the two weeks through June 30, reversing earlier outflows to leave the sector with net inflows of $357 million for the month, according to National Securities Depository Ltd. data compiled by Bloomberg.The renewed interest reflects growing confidence that the Reserve Bank of India’s recent incentives for banks to raise foreign-currency deposits will improve liquidity. The measures are expected to draw in more than $50 billion, easing funding pressures that had constrained loan growth, and improving the outlook for lenders.
