After sitting on the sidelines for three months, retail investors jumped into the equity fray in June amid a sustained rally in stock prices.
They invested over 5,607 crore in the cash market last month. In the previous three months, they had yanked out close to 20,000 crore. The retail buying happened as benchmark Nifty logged its fourth straight month of gain. The index had posted losses during the preceding five months.
Analysts said retail investors were waiting for markets to stabilise.
"A sense of stability returns when bad news is no longer impacting the price. When you see 15-30 days of markets moving up or even on days when the market is down, but the breadth of the market is stable, that is the time when sentiment changes, and that's what happened," said Amar Ambani, executive director, Yes Securities.
Foreign portfolio investors (FPIs), who have been net buyers since April, Ambani added, have also been a morale booster for retail flows.
FPIs turned net buyers of Indian equities from April onwards after being net sellers in five out of the six preceding months.
The three months of continuous selling by retail investors were attributed to tax harvesting and concerns about market stability. This stemmed from negative news flows ranging from US tariff policy to geopolitical tensions globally.
-- Sundar Sethuraman, Business Standard