The heavy selling by foreign institutional investors (FIIs) in India will soon ease as commodity prices have also come down from record highs, market watchers said on Saturday. FIIs have been buying IT stocks and this has been giving strength to IT stocks. Bank stocks were strong despite FII selling, mainly due to buying by domestic investors (DII), experts said.
Incessant selling by FIIs continued in November. After selling equity worth Rs 113,858 crore through exchanges in October, FIIs sold another Rs 41,872 crore through exchanges this month (till November 22). The buying trend by FIIs through the primary markets also continued with purchases of Rs 15,339 crore in November.
Total FII trading on the exchange during October 1-November 23 stood at Rs 155,730 crore.
“This is the type of selling that happens in a year when FIIs are in a selling position,” said Vinod Nair, Head of Research, Geojit Financial Services.
Three key factors have led to this massive sell-off by FIIs. Firstly, the ‘Sell India, Buy China’ trade and secondly, it is about FY25 earnings.
“The third factor is ‘Trump trade.’ Of the three, the ‘Sell India, Buy China’ trade is over Trump’s trade also appears to be in its final stages as valuations have reached record highs in the US,” Nair explained, adding that, as a result, FIIs selling in India. it will probably end soon.
According to Rohit Agarwal, CEO, Financial Business, Dovetail Capital, SEBI’s recent steps improve market stability and play an important role in protecting the interests of investors, ensuring a strong exit market.
“Limiting the weekly expiry to a single index of NSE and BSE may encourage a shift in trading rates to GIFT City, which still offers a wide range of weekly options. From FPI’s point of view, this creates an attractive opportunity for those who want flexibility in trading strategies. ,” he said.
While some of the sales by FIIs in the secondary market are replaced by purchases in the primary market – with large public offerings such as Swiggy and Hyundai, FIIs are expected to reduce their sales as we approach the end of the calendar. a year.
“New allocations or significant investments are possible once there is more clarity on the policies of the Trump administration,” said Vipul Bhowar, Senior Director, Listed Investments, Waterfield Advisors.
Upcoming major IPOs may briefly increase investment in primary markets, but continued interest will depend on macroeconomic stability and corporate earnings performance, experts say.
