FIIs Continue Selling as DIIs Invest in Indian Equities

FIIs Continue Selling as DIIs Invest in Indian Equities

VoM News Desk | October 11, 2023 | 01:39 PM IST | Breaking News | Follow on Google News

FIIs Continue Selling as DIIs Invest in Indian Equities

FIIs Continue Selling as DIIs Invest in Indian Equities

On Tuesday, October 10, foreign institutional investors (FIIs) continued to offload Indian equities, while domestic equity benchmarks, the Sensex and Nifty, managed to close higher despite ongoing concerns surrounding the Israel-Hamas conflict. In contrast, domestic institutional investors (DIIs) remained net buyers, injecting ₹783.25 crore into Indian stocks.

According to NSE data, FIIs collectively purchased ₹8,067.15 crore worth of Indian equities but sold ₹9,072.64 crore, resulting in a net outflow of ₹1,005.49 crore on Tuesday. Meanwhile, DIIs infused ₹8,623.58 crore into the market but offloaded ₹6,660.24 crore, ultimately registering an inflow of ₹1,963.34 crore.

Market Commentary and Global Cues

Market analysts pointed out that the decline in the dollar index to 105.95 and the US 10-year bond yield falling to 4.65 from its recent high of 4.88 were positive developments for equity markets. Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted that despite FIIs continuing to sell in India, the intensity of their selling has lessened.

India’s market sentiment improved following positive global cues, as US bond yields eased due to remarks from Federal Reserve officials regarding interest rates. Global stocks made gains in response to this development, and oil prices eased, despite ongoing tensions in the Middle East.

Nifty 50 closed at 19,689.85, up 178 points (0.91%), while the Sensex ended the day at 66,079.36, up 567 points (0.87%). Mid and small-cap indices outperformed the benchmarks, with the BSE Midcap index rising 1.14% and the BSE Smallcap index ending 1.26% higher.

Market Outlook and Strategies

Analysts highlighted the decreasing intensity of FII selling, the rise of DIIs as net buyers, and the importance of the upcoming earnings season in India. Market experts suggested that a strategy of calibrated buying in small quantities of quality stocks in sectors like banking, automobiles, IT, capital goods, and real estate/construction could be favorable for long-term investors.

However, they also acknowledged the uncertainty surrounding the Israel-Hamas conflict and its potential impact on markets, emphasizing that geopolitical developments cannot be predicted with certainty.

Technical View and Short-Term Analysis

Market analysts noted that the frontline indices staged a sharp rebound, with the benchmark Sensex closing above the psychological 66,000 mark due to short covering. On the hourly chart, the Nifty broke out of an inverted head and shoulders pattern, signaling potential short-term strength. A decisive move above 19,700 points could drive the index toward the range of 19,850 to 19,900, with support at 19,600.

VoM News Desk

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