NEW DELHI: Foreign portfolio investors injected Rs 3,346.94 crore into Indian equity markets during the week, driven by optimistic sentiment following the Reserve Bank of India’s (RBI) interest rate reduction, as reported by National Securities Depository Limited (NSDL) data.The RBI’s rate reduction bolstered investor confidence, resulting in substantial FPI inflows during the initial three trading sessions from June 9 to June 13, according to the reported quoted by ANI. The escalating tensions between Israel and Iran, however, affected investor sentiment towards the week’s end.However, FPIs withdrew Rs 3,275.76 crore from Indian equities on Friday, the final trading session. This substantial withdrawal reduced the week’s net investment to the net figure.During periods of international conflicts, such as the current Israel-Iran situation, investors typically favour secure assets like gold, potentially reducing investments in developing markets including India.Despite the week’s positive inflows, June’s overall FPI investment remains negative. According to NSDL data, FPIs have withdrawn Rs 5,402 crore from Indian equity markets in June thus far.The Reserve Bank of India’s Monetary Policy Committee (MPC) announced an unexpected 50 basis points rate reduction on June 6th. The repo rate decreased to 5.5 per cent, strengthening investor confidence.May had also recorded positive net foreign portfolio investment (FPI) inflows of Rs 19,860 crore, establishing it as the strongest month for foreign investment this year.Previous data indicated FPIs sold shares worth Rs 3,973 crore in March. They had additionally sold equities valued at Rs 78,027 crore and Rs 34,574 crore in January and February, respectively.