FIIs sell equities worth Rs 1,795 crore last week; FPIs turn sellers

Amid the renewed tensions between US and Iran that has caused a sharp spike in the crude oil prices and the higher global bond yields Foreign Portfolio Investors FPI are turning sellers in the Indian equity markets according to analystsThere are indications of FPI flows again turning negative after the positive flows in July and August NSDL data up to 12th September shows FPI outflows of Rs 14474 crore via selling through the exchanges V K Vijayakumar Chief Investment Strategist Geojit Investments saidHowever the booming activity in the primary markets with nearly 12 mainboard IPOs valued at over Rs 7000 crore during the week diverted the investor sentiment from the secondary market he notedThe trend of FPI investment through the primary market has been continuing in September also as per early indications FPI investment through the primary market up to September 12 stood at Rs 1336 crore taking the total investment through the primary market this year to Rs 47183 crore he saidGoing forward FPI flows will continue to monitor USIran conflict and the consequent impact on crude pricesElevated crude prices Brent is above USD 108 and higher inflation implies tighter monetary policy which means bond yields will rise further If the US 10year inches up to 5 per cent there can be a sharp correction in equity markets globally In such a scenario FPIs may turn sellers and move money to high yielding bonds he saidFIIs continue to sellMeanwhile Foreign Institutional Investors FIIs continued to be sellers in the domestic equity market for the fourth consecutive week offloading Rs 1795 crore worth equities during September 7 to 11FIIs ended the week as net sellers for the fourth consecutive week offloading Rs 1795 crore with four of the five sessions closing in the red Domestic Institutional Investors DIIs stayed on the buy side extending their streak with accumulation of Rs 6419 crore though this was a sharp step down from the Rs 23156 crore deployed the previous week Pabitro Mukherjee Deputy Vice President Research Bajaj Broking saidHe noted that despite the cushion provide by the DIIs it was not enough to arrest the decline in the benchmark index Nifty on Friday when DII buying peaked at Rs 1968 crore against the weeks largest FII sale of Rs 931 croreMarket indices declineThe domestic equity benchmark indices extended losses for the fifth straight week amid a surge in global crude oil prices that hit a fourweek high on Friday due to the heightened tensions between US and Iran and higher US bond yield ratesDuring the week the Sensex tumbled 173367 points or 227 per cent while the Nifty slipped 49960 points or 209 per cent The indices declined on four out of the five days during last weekOn Friday the market indices however recovered from their intraday lows to minimise the fall as the crude oil prices eased The 30share BSE Sensex dropped 12083 points or 016 per cent to end at 7478176 while the 50share NSE Nifty slipped 7970 points or 034 per cent to settle at 2339810In terms of month to date Mukherjee noted that FIIs remained marginal net buyers at Rs 579 crore largely based on the Rs 6688 crore inflow on September 2Excluding that single session they are net sellers of Rs 6110 crore DIIs have bought Rs 24987 crore across all nine sessions taking combined institutional inflows to Rs 25566 crore even as the Nifty shed 6823 points or 28 per cent from its August close of 2408040 with seven of the nine sessions negative he saidOver the last five weeks FIIs were net buyers only in the first August 10ndash14 before turning net sellers in each of the four that followed while DIIs have bought without a break since August 11 a run of 24 sessions The index has nonetheless fallen in every one of those weeks with 18 of 24 sessions ending lower indicating that domestic absorption has cushioned rather than countered the downtrend he addedAccording to Mukherjee market participants will track Indias CPI inflation data for market direction and institutional flows along with crude oil prices the USIran conflict and the US Federal Open Market Committee decision on interest rates