End of Relentless FII Sell-Off as Indian Economy Proves Its Resilience
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New Delhi, Dec 7 (NationPress) In a notable shift in strategy, foreign institutional investors (FIIs) have begun purchasing stocks, marking the conclusion of extensive FII sell-offs, as the Indian economy demonstrates its resilience amidst geopolitical challenges, analysts reported on Saturday.
Data from the National Securities Depository Limited (NSDL) indicates that FIIs have invested ₹24,453 crore this month (up to December 6). This investment comprised ₹17,921 crore in equities via exchanges and the remainder through the primary market.
The transition of FIIs to buyers in early December represents a complete reversal of their prolonged selling strategy observed over the past two months, significantly altering market sentiments, according to market experts.
In October, the total FII sell-off via exchanges reached ₹113,858 crore, which decreased to ₹39,315 crore in November.
Siddhartha Khemka from Motilal Oswal Financial Services Ltd noted that FIIs have commenced December on a favorable note, significantly enhancing market sentiment.
“Next week, we anticipate the Nifty to continue its gradual ascent, supported by a potential increase in liquidity following the RBI's CRR cut, positive developments regarding government policies, and the resurgence of FII inflows,” he stated.
The alteration in FII strategy is evident in the movements of stock prices, particularly in large-cap banking stocks where FIIs had previously been sellers.
This sector has additional potential for growth as it is generally well-valued and progressing at a satisfactory rate, experts mentioned.
FIIs have indicated a gradual return, providing much-needed relief after the continuous selling pressure experienced in October and November. Despite substantial FII sell-offs, inflows from domestic institutional investors (DIIs) have kept the market stable over the last two months.
Moreover, for the first time in eight weeks, India’s forex reserves have risen by a modest $1.51 billion, reaching $658.091 billion for the week ending November 29.
For the week ending November 29, foreign currency assets, a critical component of the reserves, increased by $2.061 billion to $568.852 billion, as per the weekly data from the RBI.
