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Last Updated : Apr 10, 2020 10:14 AM IST | Source: Moneycontrol.com

Foreign investors return to Indian market in April after dull March; Sensex up 13% this week

FIIs have net purchased Rs 1,737.62 crore worth of shares on April 9, following Rs 1,943.41 crore and Rs 741.77 crore of buying in the previous two consecutive sessions

Sunil Shankar Matkar

Foreign institutional investors seem to have turned optimistic on Indian equities at least for the time being. They were net buyers for the third consecutive session on April 9, the last trading day of the truncated week.

FIIs have net purchased Rs 1,737.62 crore worth of shares on April 9, following Rs 1,943.41 crore and Rs 741.77 crore of buying in the previous two consecutive sessions.

This comes after foreign investors sold Indian equities in huge quantities in March. The net bought equities by FIIs are Rs 1,345.04 crore for April so far against Rs 65,816.70 crore of selling in March.

Close

On the other side, domestic institutional investors used the rally to sell shares as they net sold Rs 466.02 crore on April 9 and Rs 1,757.79 crore in the previous session.

DIIs have been net sellers in April so far with an outflow of Rs 2,025.11 crore against net buying of Rs 55,595.18 crore in March.

In fact, the FII buying has lifted market sentiment for the entire week after a consolidation seen in the previous two weeks.

Sensex and Nifty rallied nearly 13 percent each this week to close above 31,000 levels and 9,100, respectively.

Markets were also driven by expectations of infections peaking out in the worst affected countries and expectations of more stimulus measures.

The market has shown a spectacular journey from multi-year lows hit on March 23, when the benchmark indices recorded the biggest ever single-day loss. Both indices have recovered more than 21 percent of losses each from those low points.

Investors turned wealthier by Rs 12.4 lakh crore during the week itself and by nearly Rs 19 lakh crore since March 23.

But experts are not convinced this up move will last long. They said it seems to be a short-term bear market rally and may not be sustainable given the weak earnings and economic growth going ahead after COVID-19.

"Markets will continue to fluctuate based on news coming out regarding the spread of infections and any lifting of lockdown in India," Vinod Nair, Head of Research at Geojit Financial Services told Moneycontrol.

He said in India, there was expectation that the worst affected sectors and MSMEs may get some relief in another package to be announced shortly.

Jimeet Modi, Founder & CEO at SAMCO Securities & StockNote also feels the COVID-19 situation remains fluid and uncertainty still looms on the possible economic impact of the outbreak.

However, in the coming week it is expected that market will be guided by global sentiments with sudden gap ups or gap downs, he said, adding any negative surprises with respect to the lockdown will also have an impact on bourses.

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First Published on Apr 10, 2020 08:53 am
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