The stock-selling spree unleashed by foreign institutional investors over the past one month from November has turned them net sellers in the cash market this calendar year. But the markets have shown resilience mainly due to big buying by insurance companies, say experts.
The continued selling in frontline stocks by foreign investors over the past one month, which also coincided with curbs on participatory notes (P-notes), delayed the Sensex and the Nifty from closing above the crucial milestone of 20,000 and 6,000 respectively.
Infrastructure, realty are the current favourites.
With the stock markets growing in size, this rule, which was framed eight years back, needs revision to allow such nominal dilution only if the IPOs are worth Rs 500 crore (Rs 5 billion) or above, according to experts. The rules require promoters to shed at least 25 per cent if the IPOs are less than Rs 100 crore (Rs 1 billion). The promoter holding in 500 listed companies has gone up to 58 per cent during the July-September quarter from 54 per cent in the April-June quarter.
While Geojit Financial Services and Kotak Securities are already managing large NRI portfolios in West Asian countries, Sharekhan, yet another local brokerage outfit, recently launched a broking platform called India First in Bangkok for NRI clients.
Credit Agricol (CA), the second-largest French bank, is all set to enter the Indian insurance and asset management business.US-based middle market focused investment bank Jefferies Group, which opened its representative office in New Delhi last month, plans to enter the institutional brokerage and asset management business in India.
High net-worth individuals, or the rich investors with investment portfolios of Rs 25 lakh and above, who totted up huge losses in this year's price corrections in February and August, are booking profits following the nearly 4,000-point surge in the Sensex since late August.
A day after Federal Reserve Chairman Ben Bernanke announced the rate cut, FIIs bought shares worth over Rs 2,400 crore (Rs 24 billion), lifting the index up by 650 points, one of its biggest intra-day gains.
Foreign institutional investors (FIIs), which were the major sellers last month, are on a buying spree.
Of the 450 stocks, 243 stocks -- mostly small- and mid-caps -- touched their 52-week highs on Tuesday. Both the Sensex and Nifty ended the day with declines of 0.34 and 0.24 per cent respectively.
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