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OBJECTIVE OF THE STUDYThe objective of this study is to find out whether there exists any significant relation between the Indian stockmarket (NSE-CNX NIFTY) and FII.1.3 RESEARCH METHODOLOGYIn this paper descriptive research has been used, data from different websites have been collected likeNSE, NSDL, money control and RBI.Firstly data has been collected for 10 years to show the relationshipbetween the two variables and then month wise data has been collected and compared. Correlation is used to seethe impact of FIIs on Indian Stock. Further statistical analysis is also used to find out whether FIIs have emergedas the most dominant group of investors in Indian Capital market or not.1.4 ANALYSISTo find out the whether FIIs affect the Indian stock market and Indian economy, correlation has beencalculated between Closing Index of FII and FII inflows. Correlation has been calculated for the data from2006-2016, month wise from April 2015-March 2016, and day wise from 16 March-2015 to 31 March 2015.Firstly, the analysis starts with data of past 10 years which includes closing Index of CNX NIFTY and totalinflows of debt and equity by FIIs from the year 2006-2016.Table 1: Correlation betweenClosing Index of CNX NIFTY and total inflows of debt and equity by FIIs (2006-2016)Year Closing Index of CNX NIFTY FII Inflows(in Cr.)2006 3966.4 414672007 6138.6 308402008 2959.15 661792009 5201.05 -458112010 6134.5 1426582011 4624.3 1464382012 5905.1 937262013 6304 1683672014 8282.7 516492015 7946.35 2774612016 8185.8 -18176Correlation 0.165709494From the table the correlation between closing Index of CNX Nifty and FIIs inflows has been calculated. Thecorrelation comes out to be 0.1657 which indicates positive relationship between the two variables- Indian StockMarket represented by Closing Index of CNX Nifty and FII Inflows.Table 2: Correlation betweenClosing Index of CNX NIFTY and total inflows of debt and equity by FIIs (April2015-March 2016)Month Closing Index of CNX NIFTY FII Inflows (in Cr.)Apr-15 8181.5 7,864.36May-15 8433.65 -4,796.25Jun-15 8368.5 -8,192.92Jul-15 8532.85 2,298.05Aug-15 7971.3 -19,772.07Sep-15 7948.9 -11,279.32Oct-15 8065.8 3,026.66Nov-15 7935.25 -9,029.81Dec-15 7946.35 -2,360.02Jan-16 7563.55 -14,356.01Feb-16 6987.05 -12,513.12Mar-16 7738.4 24,201.51Correlation 0.200783656On the basis of Table 2 having data of 2015-2016, Correlation between closing index and FIIs inflowshas been calculated which comes out to .020078 which again shows significant relationship between the IndianImpact of Foreign Institutional Investors (FIIs) on Indian Capital MarketDOI: 10.9790/487X-1906034246 44 | PageStock Market and foreign institutional investors.To get more insight of the relationship in depth study of 12 daysof the month of March 2015has been taken.Table 3: Correlation betweenClosing Index of CNX NIFTY and total inflows of debt and equity by FIIs (April2015-March 2016)Date Closing Index of CNX NIFTY FII Inflows (in Cr.)16-Mar-15 -762.55 8633.1517-Mar-15 265.52 8723.318-Mar-15 -457.43 8685.919-Mar-15 1,428.72 8634.6520-Mar-15 354.59 8570.923-Mar-15 417.41 8550.924-Mar-15 737.86 8542.9525-Mar-15 813.19 8530.826-Mar-15 -521.23 8342.1527-Mar-15 -320.52 8341.430-Mar-15 -240.34 8492.331-Mar-15 356.07 8491Correlation 0.243444483On calculating the correlation between the closing index on CNX Nifty from 16th March 2015 to 31stMarch 2015 and foreign institutional investor it comes out to .024344 which shows the significant relationshipbetween the Indian stock Market and FIIs. The Second part of the analysis is focussed on the share of FIIs inIndian Capital market. It is done through by finding out the share of FIIs in total investment made in foreigners

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