Capital Market Stocks Advance As FM Signals More Steps To Attract Foreign Investments

Shares of capital market-linked companies rallied sharply on Monday after Finance Minister Nirmala Sitharaman said recent initiatives aimed at boosting foreign capital inflows were only the beginning, raising expectations of further policy support for overseas investment participation in India.

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The buying interest was visible across asset management companies, brokerages, wealth management firms and market infrastructure operators. HDFC Asset Management Company emerged as the top gainer among the segment, while Motilal Oswal Financial Services and Nippon Life India Asset Management also recorded strong gains.

Broad-Based Rally Across Financial Services Stocks

At around 3 pm, the Nifty Capital Markets index was trading 3.2% higher at 5,519.90, with all 17 constituents in positive territory.

HDFC Asset Management Company rose 6.9% to ₹2,627. Motilal Oswal Financial Services gained 5.7%, while Nippon Life India Asset Management advanced 4.7%. Nuvama Wealth Management climbed 4.3%, and Groww  added more than 4%.

Among other major constituents, Angel One rose 3.7%, while Central Depository Services (India) Ltd. (CDSL) gained over 3%. Wealth manager 360 One WAM advanced 3%, while Computer Age Management Services (CAMS), KFin Technologies and BSE rose between 2% and 3%.

Additional gains were recorded in UTI Asset Management Company, Anand Rathi Wealth, ICICI Securities, Indian Energy Exchange (IEX) and Multi Commodity Exchange of India (MCX).

Sitharaman’s Remarks Lift Sentiment

The rally followed comments from Sitharaman at a public event, where she said that recent government and Reserve Bank of India measures to attract foreign investments represented only the first phase of broader efforts to increase overseas participation in Indian markets.

She noted that while the latest initiatives were currently focused on the bond market, further steps could be considered as India seeks to attract larger foreign capital inflows.

Her remarks came shortly after the government expanded the list of securities eligible under the Fully Accessible Route (FAR) framework for foreign investors. The government also announced tax exemptions on interest income and capital gains earned by foreign portfolio investors from investments in eligible government securities.

In addition to this, steps were taken by the RBI to encourage foreign exchange deposits and external borrowing in order to facilitate capital flows and help domestic liquidity. 

Risks Appetite in the Global Market Helps

Positive sentiments in the market were boosted due to the improvement in global cues following news of an understanding between the U.S. and Iran regarding their energy needs.

This development brought down crude oil prices and improved risk appetite in global equity markets, thereby helping stocks in the financial and capital segments.

Benchmark indices remained firmly higher during the session. At around 3:01 pm, the BSE Sensex was up 756 points at 76,284, while the NSE Nifty 50 gained 232 points to trade at 23,855, reflecting broad-based buying across sectors.