Getty ImagesHaving bought equities worth over Rs 51,204 crore last month, the pace of buying by foreign institutional investors or FIIs is slowing down this month amid hotter-than-expected US inflation data, fears of sharper rate hike by the US Fed and global recession.
NSDL data shows that till September 16, the FIIs bought stocks worth 12,084 crore through exchanges but they are turning sellers in the cash market in the last few days. On Friday itself, foreign investors sold equities worth around Rs 3,260 crore, which analysts said was the prime reason behind the 1,093-point crash as domestic institutional investors sold stocks only worth Rs 36.57 crore.
“A major factor supporting the recent rally in the Indian market has been the sustained FII buying that started in July and gathered momentum in August. FIIs are likely to wait and watch before resuming their buying in India,” V K Vijayakumar, Chief Investment Strategist at said.
Analysts say the flow of FIIs would be determined by Jerome Powell’s rate hike decision at the end of the FOMC meeting this Wednesday. Nomura analysts had last week said the Fed is likely to raise its short-term interest rate target by a full percentage point.
What's also making investors nervous is the growing warnings around impending recession. American delivery giant FedEx has warned that the economy was about to enter a "worldwide recession".
"Wall Street was already nervous that the Fed’s inflation fighting mission was going to trigger a recession, but now it seems corporate America is already showing signs that the economy is slowing," said Edward Moya, Senior Market Analyst, OANDA.
Back home, the role of domestic institutional investors, led by mutual funds, would be a key determinant of Nifty’s trajectory as DIIs have also been sellers recently.
“HNI and retail investors are incrementally focussing on a more disciplined and consistent approach to investing, and they also understand that corrections are good buying opportunities. DII’s have been sellers recently but I believe there is nothing significant to read into this, and is a normal course of cyclicality as when markets perform well, some profit booking is bound to happen,” said Amit Nadekar, Senior Equity Fund Manager, Mutual Fund Asset Management.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of
NSDL data shows that till September 16, the FIIs bought stocks worth 12,084 crore through exchanges but they are turning sellers in the cash market in the last few days. On Friday itself, foreign investors sold equities worth around Rs 3,260 crore, which analysts said was the prime reason behind the 1,093-point crash as domestic institutional investors sold stocks only worth Rs 36.57 crore.
“A major factor supporting the recent rally in the Indian market has been the sustained FII buying that started in July and gathered momentum in August. FIIs are likely to wait and watch before resuming their buying in India,” V K Vijayakumar, Chief Investment Strategist at said.
Analysts say the flow of FIIs would be determined by Jerome Powell’s rate hike decision at the end of the FOMC meeting this Wednesday. Nomura analysts had last week said the Fed is likely to raise its short-term interest rate target by a full percentage point.
What's also making investors nervous is the growing warnings around impending recession. American delivery giant FedEx has warned that the economy was about to enter a "worldwide recession".
"Wall Street was already nervous that the Fed’s inflation fighting mission was going to trigger a recession, but now it seems corporate America is already showing signs that the economy is slowing," said Edward Moya, Senior Market Analyst, OANDA.
Back home, the role of domestic institutional investors, led by mutual funds, would be a key determinant of Nifty’s trajectory as DIIs have also been sellers recently.
“HNI and retail investors are incrementally focussing on a more disciplined and consistent approach to investing, and they also understand that corrections are good buying opportunities. DII’s have been sellers recently but I believe there is nothing significant to read into this, and is a normal course of cyclicality as when markets perform well, some profit booking is bound to happen,” said Amit Nadekar, Senior Equity Fund Manager, Mutual Fund Asset Management.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of
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