FIIs likely to become consistent buyers in Indian markets soon

MUMBAI: After a massive sell-off, it now looks like foreign institutional investors (FIIs) could become consistent buyers if the market improves further and valuations become attractive, market observers said on Saturday.A puzzling feature of recent FIIs’ activities is their highly erratic nature.

For instance, on the three days of November 23-25, FIIs were buyers. But on the next two days they again became sellers and sold equities worth Rs 16,139 crore in the Indian market.”FIIs’ selling in November is less than in October. Total FIIs’ selling through stock exchanges in October was Rs 113,858 crore. In November, it fell to Rs 39,315 crore,” an expert said.Part of this can be attributed to lower valuations due to market improvement.

Earlier this week, FIIs made a good return by investing Rs 11,100 crore in Indian equities in three sessions. Vikram Kasat, Head-Advisory, PL Capital-Prabhudas Lilladher, said this may indicate renewed confidence in India’s growth story amid global challenges, raising hopes of stability in the market in the near future. The trend of buying by FIIs through the primary market continues. In November, FIIs bought shares worth Rs 17,704 crore through the primary market.

According to experts, if we take the period till November 29, the total selling done by FIIs this year is Rs 118,620 crore. Indian stock markets closed in the green on Friday, as both equity benchmark indices Sensex and Nifty witnessed a strong rally. The Sensex closed at 79,802.79 with a gain of 759.05 points or 0.96 percent. Nifty closed at 24,131.10, up 216.95 points or 0.91 per cent. The domestic stock market gained on the back of improved investor sentiment and stock-specific activity. According to experts, “The domestic market witnessed a broad-based rally, driven by large-caps. Discretionary sectors performed well, taking advantage of the festive season.”