Singapore overtakes Mumbai as biggest market for Indian futures

We climbed 55% as they declined 60%.

Singapore is overtaking Mumbai as the biggest market for Indian stock-index futures, a sign of foreign investors’ growing influence over equities in the world’s second-most populous nation.

Bloomberg’s Chart of the Day shows open interest, or the number of outstanding contracts, for CNX Nifty Index futures on the Singapore Exchange Ltd. climbed 55 percent during the past four years to about 345,000. That compares with a 60 percent decline for similar contracts traded on the National Stock Exchange of India Ltd., according to data compiled by Bloomberg. Singapore is luring foreign investors with longer hours and lower trading costs, Kotak Institutional Equities said in a report this month.

Bloomberg adds that international money managers have bought more than $14 billion of Indian shares this year, helping fuel a 29 percent rally in the Nifty index. Much of the gains have come since Prime Minister Narendra Modi’s landslide election victory in May, with investors betting the new premier will boost growth in Asia’s third-largest economy.

“New offshore investors have started nibbling at India,” said A.S. Thiyaga Rajan, a senior managing director at Aquarius Investment Advisors Pte in Singapore, which has $450 million in Indian stocks. “Already-invested guys are also increasing exposure on optimism the new administration will boost growth.”

“NSE and SGX have been in long-term partnership to develop the global Nifty franchise,” the Singapore Exchange wrote by e-mail. “SGX provides a convenient access point for offshore investors seeking exposure to Indian equity and complements the already deep liquid equity and derivatives markets in India.”