Long winter on the Street set to get longer! FIIs don’t seem to be coming back anytime soon

long winter on the street set to get longer! fiis don’t seem to be coming back anytime soon
© Moneycontrol Long winter on the Street set to get longer! FIIs don’t seem to be coming back anytime soon

A characteristic of the ongoing market correction has been heavy selling by foreign investors. Since October last year, they have withdrawn about net Rs 2.08 lakh crore equities, as per NSDL data. Not surprisingly, indices are trading lower by about 18 percent from their highs.

Apparently the nine month long winter is likely to get even longer now. Commentaries from foreign money managers and expectations from domestic analysts suggest that it will take a lot of factors to culminate for them to come back.

A couple of major reasons why foreign investors have been bearish on Indian markets are rising US dollar which has also led to more yields on bonds, and monetary tightening that is likely to have a negative impact on the economy.

Concerns over near-term risks including tightening monetary conditions, a slowing economic outlook, likely earnings cut for the Nifty and headwinds from higher crude oil prices will likely keep them away, say analysts.

BofA Securities also sees Nifty testing 14,000 levels. As of now the index hovers around 15,500. Christopher Wood, Head of Global Equities at Jefferies, has said he will raise India’s weightage in his portfolio only if Nifty falls to 14000-14500 level.

So, it is obvious that the near-term outlook of foreign investors remains bearish, which means the Indian market will remain under pressure for now, even though domestic inflows continue. Though, at this point a recent statement from value investor Vijay Kedia assumes importance who said that the real game of the stock market will begin when both FIIs and DIIs will turn net buyers. So, when will that be? There is no clear answer, except, not anytime soon.

“The weak business cycle due to higher inflation and slump in demand may continue for the next 15-18 months. So unless any India-specific trigger or any dramatic change in the economy, FII selling pressure is expected to sustain,” said Vinit Bolinjkar, Head of Research, Ventura Securities.

Vinod Nair, Head of Research at Geojit Financial Services, said FII selling in emerging markets will stop when the hawkish policy of central banks is fully factored in the market. And, that will take time.

A big resolution to the inflation risk will be if global inflation starts to revert following the halt of war in Europe and re-opening of the Chinese economy by revamping supply constraints.

Akhilesh Jat, Category Manager – Equity Research, CapitalVia Global Research also agreed that the US Fed is likely to continue hiking rates aggressively, and FII selling in the Indian market may continue.

Rate hikes lead to a spike in bond yields, which drives away money from emerging markets like India into the US bonds.

The biggest casualties of foreign investor selling has been IT and banking stocks, i.e., where they hold the biggest stake. Nifty IT index is down 20 per cent year to date and Nifty Bank has fallen 10 per cent.

Analysts do not see any quick recovery in IT stocks, given their heightened valuations. On banking stocks though most analysts are bullish, and are overweight in their portfolio.

News Related

OTHER NEWS

‘How Can Anyone Hate Him?’ Hardik’s ‘Great Gesture’ For Irish Youngster Melts Fans’ Hearts

© Provided by MensXP Leading the Indian team for the first time in his career, Hardik Pandya led from the front as the Men in Blue began the two-match T20I ... Read more »

Flu vaccine linked to 40 percent reduced risk of Alzheimer's disease: Study

© Provided by Zee News New York: People who received at least one influenza vaccine were 40 per cent less likely than their non-vaccinated peers to develop Alzheimer’s disease over ... Read more »

ITR Filing: How to claim HRA exemption

how to claim HRA exemption, how to claim HRA, how to claim exempt HRA, house rent allowance, Income Tax slabs The HRA or House Rent allowance is compensation provided by ... Read more »

Asus ROG Phone 6 is set to launch soon and here's what we know about it

Asus is all set to launch the new ROG gaming smartphone next month – the ROG Phone 6. © Provided by Business Today Asus ROG Phone 6 is set to ... Read more »

Bajaj Auto agrees to buyback shares worth Rs 2500 crore

© Provided by CNBCTV18 Two-wheeler major Bajaj Auto Ltd informed the stock exchanges on Monday that the company has approved buyback of shares worth up to Rs 2,500 crores. The ... Read more »

India is betting on casinos, online games and horse races to fill its coffers

© Canva India is betting on casinos, online games and horse races to fill its coffers The Indian government is reportedly all set to increase GST on online gaming to ... Read more »

England opt to bowl; South Africa hand nine debuts

© Getty Images Nat Sciver sweeps strongly © Getty Images Toss England chose to bowl vs South Africa England have won the toss and opted to bowl first in the ... Read more »

SEBI to auction 23 properties of Utkarsha Plotters to recover investors' wealth

© Provided by Business Today SEBI to auction 23 properties of Utkarsha Plotters to recover investors’ wealth Market regulator Securities and Exchange Board of India (SEBI) plans to auction 23 ... Read more »

India vs Ireland, 1st T20: Hardik Pandya reveals why Ruturaj Gaikwad was not sent to open the innings with Ishan Kishan

© Provided by Zee News When India came out on the field to chase 109 in the first T20I against Ireland at Malahide, Ruturaj Gaikwad didn’t come out to open ... Read more »

Nifty eyes 16,000 as sentiment indicators play cheerleaders

© Moneycontrol Nifty eyes 16,000 as sentiment indicators play cheerleaders The Nifty50 touched the higher end of resistance at 15,900 in the opening trade itself on June 27 but dipped ... Read more »

Fitch affirms ‘BBB-‘ rating to GAIL, outlook stable

© Provided by The Financial Express GAIL holds around 70 per cent share of the gas-transmission network and more than 50 per cent share of natural gas sales in India. ... Read more »

LIVE Cricket Score, England vs New Zealand, 3rd Test Day 5 in Headingley

© Provided by Firstpost LIVE Cricket Score, England vs New Zealand, 3rd Test Day 5 in Headingley Day 4 report: England moved closer to a series sweep after reaching stumps at ... Read more »

Expert Explain How to Take Care of Your Hair During Monsoon Season

© Provided by News18 Expert Explain How to Take Care of Your Hair During Monsoon Season Thick and beautiful hair adds to the positive features and helps anyone look more ... Read more »

Sanjay Raut cooks up stories which are fit for a film: Eknath Shinde’s son

© Provided by Hindustan Times Supporters of Shiv Sena rebel leader Eknath Shinde burned Shiv Sena MP and leader Sanjay Raut’s effigy. (Praful Gangurde/HT photos) Taking a sly dig at ... Read more »

Prepare for scrutiny if you want to play the big boys' game: Experts on RBI's recent fintech crackdown

© Provided by Moneycontrol Prepare for scrutiny if you want to play the big boys’ game: Experts on RBI’s recent fintech crackdown A two-paragraph notification from the RBI on June ... Read more »

IGNOU TEE 2022: Application deadline extended, details here

© Provided by DNA The Indira Gandhi National Open University, IGNOU has extended the deadline for the term-end examination (TEE) 2022 form submission to June 30. Candidates can now submit ... Read more »

Easy DIY home decor ideas to add character to your living room

If you want an affordable and easy solution to revive your home, then there is nothing better to start from DIY hacks! Beyond saving plenty of money, these easy-to-do nifty ... Read more »

PM should have acknowledged India’s achievements till 2014: Chidambaram on Modi’s remarks in Germany

© Provided by The Financial Express “The PM should have acknowledged the tremendous achievements by 2014 and that his government is only continuing the work of previous governments,” Chidambaram said. ... Read more »

GST at 5: The making of a tax system – a timeline of key milestones

© Mohammed Shaikh GST at 5: The making of a tax system – a timeline of key milestones The Goods and Services Tax (GST) was introduced on July 1, 2017 ... Read more »

Why ED summoned Shiv Sena leader Sanjay Raut? What is the Patra Chawl case?

© Provided by DNA Sanjay Raut, a member of the Shiv Sena party, was called by the Enforcement Directorate (ED) on Tuesday for interrogation over money laundering and other financial ... Read more »

Orange to Potato, How Peels of These Fruits and Veggies Benefit Your Skin and Hair

© Provided by News18 Orange to Potato, How Peels of These Fruits and Veggies Benefit Your Skin and Hair If you also throw away the peels of fruits and vegetables ... Read more »

Stock Market Highlights: Sensex ends over 400 points higher, Nifty50 shuts shop above 15,800; Zomato ends 6% lower

15:24:52 IST Sakthi Sugar to sell Dhenkanal Plant to Indian Potash 15:10:44 IST Bajaj Auto agrees to buyback shares worth Rs 2500 crore Two-wheeler major Bajaj Auto Ltd informed the ... Read more »

Simranjit Mann credits his Sangrur win to Khalistani militant Jarnail Singh Bhindranwale

© Provided by The Statesman Simranjit Mann credits his Sangrur win to Khalistani militant Jarnail Singh Bhindranwale Pro-Khalistan leader Simranjit Singh Mann’s victory in by-poll for Sangrur Lok Sabha constituency ... Read more »

Sidhu Moosewala murder: Supreme Court to hear plea of Lawrence Bishnoi's father challenging transit remand on July 11

© Provided by Zee News New Delhi: The Supreme Court of India on Monday said that it will hear on July 11, the plea of accused Lawrence Bishnoi`s father challenging ... Read more »

JEE Main 2022 Paper 1 analysis for June 27 exam: Easy to moderate difficulty level

JEE Main 2022 Paper 1 analysis for June 27 exam: Easy to moderate difficulty level The JEE Main 2022 Paper 1 Shift 1 was held on the sixth day from ... Read more »

Goa's Salaulim Dam With 140-foot-deep Magical Spillway is Right Out of 'Batman'

© Provided by News18 Goa’s Salaulim Dam With 140-foot-deep Magical Spillway is Right Out of ‘Batman’ Goa is known for some spectacular tourist destinations but the place is also famous ... Read more »

SC allows rebel Shiv Sena MLAs to reply to disqualification notice by July 11

© Provided by DNA In an interim direction, Supreme Court Monday allowed Eknath Shinde and other rebel Shiv Sena MLAs to file a reply to the disqualification notice issued to ... Read more »

Stats - Australia await trial by left-arm spin

© AFP Steven Smith is one of many Australian batters who had a difficult time during the tour of Sri Lanka in 2016 © AFP Sri Lanka are a Test ... Read more »

Richie Berrington appointed Scotland captain

© Peter Della Penna Richie Berrington is Scotland’s most-capped player in ODI and T20I cricket © Peter Della Penna Richie Berrington has been appointed Scotland captain after Kyle Coetzer stepped ... Read more »

'Vertigo attack, back injury, sprained ankle, cracked toe': Nushrratt Bharuccha on working despite ill health

© Provided by Free Press Journal Nushrratt Bharuccha is an uprising actress of Bollywood who is currently basking in the success and the amazing response from the audiences for her ... Read more »

Puri Jagannadh gives a befitting reply to Bandla Ganesh's remarks; Read inside

© Provided by Pinkvilla Bandla Ganesh’s remarks on Puri Jagannadh have sparked yet another controversy after he received criticism from Mahesh Babu’s followers for his inappropriate remarks. The ‘Liger’ director, ... Read more »

India vs England: Jasprit Bumrah might be a rare fast-bowling India captain

© Provided by Firstpost India vs England: Jasprit Bumrah might be a rare fast-bowling India captain India pacer Jasprit Bumrah is highly possible to lead the side in the rescheduled Test ... Read more »

Pirelli plans stronger F1 front tyre for 2023 to dial out understeer

The new generation of ground effect machinery have marked a departure in aero concept from previous grand prix challengers, and have resulted in different characteristics. One of the consequences of ... Read more »

Kumkum Bhagya, 27th June 2022, Written Update: Ranbir consoles Prachi

© Provided by Pinkvilla In today’s episode, Aaliya tells Rhea that she trapped Ranbir. Flashback comes. Prachi and Ranbir argue. Rhea overhears them. Prachi pushes Ranbir out of the room. ... Read more »

Gayatrii Bhhardwaj, Ritvik Sahore share their experience of working on 'Ishq Express'

© Provided by Free Press Journal Actors Ritvik Sahore and Gayatrii Bhhardwaj recently opened up about their experience of working on the recently released series ‘Ishq Express’. The story of ... Read more »

Alia Bhatt Pregnant: Neetu Kapoor Reacts As Paparazzi Say 'Dadi Banne Wale Ho'

© Provided by News18 Alia Bhatt and Ranbir Kapoor fans are super excited after the Gangubai Kathiawadi actress announced her pregnancy in a super adorable post. Earlier in the day, ... Read more »

Shoaib Ibrahim & Dipika Kakar give a glimpse of their monsoon romance in new music video ‘Barsaat Ke Mausam’

© Provided by Pinkvilla Shoaib Ibrahim and Dipika Kakar are among the most loved couples in the entertainment industry. The couple fell in love during their show Sasural Simar Ka, ... Read more »

'Burj Khalifa' singer Nikhita Gandhi drops her new EP 'Saazish'

© Provided by Free Press Journal Nikhita Gandhi, the voice behind Bollywood chartbusters like ‘Jugnu’, ‘Naach Meri Rani’, ‘Burj Khalifa’, ‘Qafirana’, ‘Ullu Ka Pattha’, and ‘Naaja’, added a new gem ... Read more »

Watch Video: India captain Hardik Pandya praises Ireland’s Harry Tector, gifts him a bat too after 1st T20I

© Provided by Free Press Journal Ireland’s Harry Tector en route his unbeaten 64 against India That moment when @hardikpandya7 revealed his conversations with Ireland’s Harry Tector while handing over ... Read more »

Kiwi star matches Sir Donald Bradman's batting record, becomes first overseas cricketer since 1930 to scale massive feat

© Provided by Hindustan Times Daryl Mitchell gestures to his partner during the third Test between England and New Zealand (AFP) An in-form England unit led by Ben Stokes are ... Read more »