The Foreign Institutional Investors (FIIs), on Monday, continued to maintain their selling streak after the market ended on a lower note amid weak global cues.
According to NSE data, released on November 20, FIIs have sold cumulatively ₹9,421 crore and bought over ₹8,776 crore, resulting in an outflow of ₹645 crore on Monday. Meanwhile, Domestic Institutional Investors (DIIs) invested ₹ 6,646 crore and unloaded ₹6,369 crore, recording an inflow of ₹77 crores.
Meanwhile, on Friday, FIIs sold Indian equities cumulatively ₹12,035.41 crore and bought over ₹11 557. While, DIIs invested ₹ 6,849 crore and sold ₹7,414 crores
FIIs have been shedding Indian stocks since October, driven by historically high US bond yields, the strengthening dollar index and geopolitical uncertainties stemming from the Israel-Hamas conflict. These combined factors exerted downward pressure on market sentiment.
Despite continued concerns about high interest rates and a global economic slowdown, foreign inflows remained moderate. However, the outflow in November notably decreased due to lower US bond yields and a drop in crude oil.
Analysts believe that despite facing many challenges, the Indian market is showing continued resilience. Foreign investors are increasingly worried that constant selling could cause them to overlook potential growth in the Indian market. This concern may act as a deterrent, limiting significant selling by Foreign Institutional Investors (FIIs) in the coming days.
“High long-term interest rate trends and a weakening global economy continue to hurt inflows and market movement. While the recent softening of inflation in the US and India and the negative trend of crude is expected to help the view on global equity and India in the short term. In that context , the ease in FII selling is helping the domestic markets but continues to consolidate mainly due to India’s premium valuation relative to global peers. In this scenario, the IT sector is benefiting; however, valuation continues to be on the higher side compared to long-term history, suggesting a cautious approach in the sector in the medium term,” said Vinod Nair, Head of Research at Geojit Financial Services.
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Updated: 20 Nov 2023, 18:57 IST
(tagsTo Translate)Foreign Institutional Investor