FIIs offload ₹12 crore in Indian stocks, analysts see near-term short-covering; DIIs infuse ₹403 crore

Foreign institutional investors (FIIs) extended their selling spree on Friday, November 3, even as domestic markets rose for the second consecutive session amid positive cues. Infusion of domestic institutional investors (DIIs). 403 crore in Indian stocks today.

According to the NSE data, FIIs bought cumulatively 7,739.00 crore of Indian equities, and sell them 7,751.43 crore — resulting in an outflow of 12 crore on Friday. Meanwhile, infusion of DIIs 7,932.73 crore and unloaded 7,530.04 crore, registering an inflow of 402.69 crore.

FIIs have sold Indian equities since October on record US bond yields, the strength of the dollar index, and geopolitical risks due to the war between Israel and Hamas. These combined factors have since weighed on market sentiment.

The US Federal Reserve’s decision to hold rates and refrain from hawkish indicators has spurred the bulls to make a strong comeback in the US parent market with the S&P rising 1.9 percent yesterday, according to market analysts.

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Experts project short coverage from FIIs in the short term as they turn to buyers on positive global cues. With Brent crude crashing to the $85 per barrel mark and expectations of a pause in rate hikes by the Fed, foreign investors may start buying Indian equities soon, analysts said. This could lead to short covering which could lift markets despite the uncertainty surrounding the conflict between Israel and Hamas.

“Good earnings numbers and expectations that the interest rate will remain stable so far and will decrease in H2 of CY2024 facilitated the market’s recovery. The positive global sentiments can encourage the bulls in India to come back. Since FIIs are short the market, short covering is possible,” said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

Stock Market Today

Domestic market benchmarks Nifty 50 and Sensex ended higher for the second consecutive session on Friday amid mostly positive global cues as investors’ risk appetite improved on hopes of an end to policy tightening monetary close.

Nifty 50 closed today at 19,230.60, up 97 points, or 0.51 percent. The Sensex finally closed at 64,363.78, up 283 points, or 0.44 percent. The world’s major central banks, including the US Federal Reserve, the Bank of England and the European Central Bank, left rates unchanged this month, fueling hopes that interest rates have peaked.

“A buoyancy in Asian equities led to gains in local shares as US treasury yields fell and crude oil prices dampened sentiment, despite weakness in the Gift Nifty index. The markets pared some of their early gains as investors resorted to discretionary buying due to uncertainty about higher inflation levels, simmering West Asian conflict and its impact on the global economy,” said Prashanth Tapse, Vice President Senior (Research), Mehta Equities Ltd.

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Updated: 03 November 2023, 09:52 PM IST

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