Nifty rose around 6.5 percent in the month of May with the index hitting record highs in the second half of the month offsetting losses incurred in the earlier half. The recovery was on the back of a drop in COVID-19 cases, improvement in recovery rates and pick up in the pace of vaccination. Faster than expected economic recovery also added to the sentiment.

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Despite the good news, FPIs remained net sellers in May to the tune of $397 million as against an outflow of $1,297 million seen in April.

In a report brokerage house, Edelweiss stated that the FPIs sold equities worth $876 million in the first half of May but with the improving prospects and decline in cases, they bought equities worth $479 million in the second half.

The buying was mainly seen in financials and banking stocks in the second half of the month, Edelweiss noted. FPIs added Banks & Financial stocks worth Rs 924 million in May versus a net outflow of $260 million in these stocks in the first half of the month, it observed.

Edelweiss also informed that most of the outflow in May was witnessed in the defensive sectors while the 'reopening' theme was in the flavor. The top four sectors which saw maximum outflow were IT ($415 million), Insurance ($372 million), Telecom ($237 million) and Oil & Gas ($230 million), the report stated.

Another sector that saw outflows in May was Media to the tune of $157 million due to exclusion of Zee Entertainment from the MSCI Standard Index, the report informed.

Meanwhile, the sectors which attracted FPIs flows were Banks & Finance ($666 million), Metals & Mining ($160 million), Power ($124 million), Auto ($99 million) and Logistics ($64 million).

Among individual stocks, Edelweiss noted that the major gainers in the Nifty Index were UPL, Indian Oil, State Bank of India, Asian Paints, Coal India, Eicher Motors, ICICI Bank and Maruti Suzuki.

While the major laggards in Nifty were Shree Cements, JSW Steel, Tata Consumer, and Hindustan Unilever for the month.

On a 3-month basis, the Real Estate and FMCG sectors witnessed the maximum inflows at $735 million and $432 million while Banking and financials ($575 million) and IT ($543 million) saw the most outflows, stated Edelweiss.

On the other hand, the domestic institutional investors were on the sidelines as they made net purchases of about $281 million versus net purchases of $1.48 billion seen in April.

(Edited by : Aditi Gautam)