Foreign investors have pulled over Rs 6,400 crore from the Indian equity market in the first four trading sessions of the ongoing month when the Reserve Bank of India (RBI) and US Federal Reserve raised interest rates. Given the headwinds in terms of elevated crude prices, inflation, tight monetary policy among others, FPIs' flows in India are expected to remain volatile in the near term, Shrikant Chouhan, Head - Equity Research (Retail), Kotak Securities, said. Foreign Portfolio Investors (FPIs) remained net sellers for seven months to April 2022, withdrawing a massive amount of over Rs 1.65 lakh crore from equities. This was largely on the back of anticipation of a rate hike by the US Federal Reserve and due to the deteriorating geopolitical environment following Russia's invasion of Ukraine.
The US economy has been growing comfortably for several quarters.
Investors booked profit ahead of the outcome of the two-day US Fed policy meet which begins today.
Most say a rate cut could come in RBI's June policy.
The home currency failed to keep momentum going and largely traded in a narrow range with positive bias in the absence of any market moving factors
Equity benchmark indices Sensex and Nifty buckled under selling pressure after a nine-session rally on Monday, as massive sell-off in IT, tech and telecom counters unnerved investors.
'It was because of the huge selloff in the Indian equities that the rupee fell so sharply against the dollar on Friday.'
'Short term volatility is likely due to various factors, global and domestic; investors may use this as an opportunity to increase the allocation to equities.'
RBI kept all key rates unchanged in its policy review on Tuesday.
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As many as nine respondents said RBI would hold the repo rate at 8% till March-end, 2015
The BSE Sensex overtook the famed Dow Jones Industrial Average when it hit an intra-day high of 11,157.75 on Wednesday.
The rupee on Friday rebounded from the near-80 levels to close higher by 17 paise at 79.82 against the US currency following a recovery in the domestic stocks and weakness in the greenback in overseas markets. The US dollar retreated from the two-decade high levels against a basket of six currencies which supported the rupee sentiment. At the interbank foreign exchange market, the local currency opened at 79.95 and witnessed an intra-day high of 79.82 and a low of 79.96 against the US dollar in the day trade. ,
Rupee gains for 4th day against dollar, up 17 paise on Fed stance.
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Illustration: Uttam Ghosh/Rediff.com After a brief respite at the year's start, FPIs have dumped shares worth more than $5.7 billion (Rs 42,596 crore), taking the cumulative net outflows since October to $10.5 billion (Rs 78,466 crore), and adding to the volatility on the bourses. The figure would have been a lot worse had it not been for net purchases to the tune of $5.7 billion in the primary market from October to date.
Among the Sensex firms, HCL Technologies fell the most by 2.4 per cent. IndusInd Bank (2.35 per cent), Infosys (2.28 per cent), Wipro (1.8 per cent), NTPC (1.71 per cent), Asian Paints (1.7 per cent), Tata Consultancy Services (1.36 per cent),Tech Mahindra (1.03 per cent) and SBI (1 per cent) were among the major laggards.
Equity benchmark BSE Sensex closed at an all-time high of 62,272.68 on Thursday, tracking a firm trend in global markets after the US Fed minutes indicated a slower pace of rate increase that bolstered investors' sentiment. Extending its rally to the third straight day, the 30-share BSE benchmark rallied 762.10 points or 1.24 per cent to settle at 62,272.68, its record closing peak. During the day, it jumped 901.75 points or 1.46 per cent to its lifetime high of 62,412.33.he broader NSE Nifty gained 216.85 points or 1.19 per cent to end at 18,484.10.
The 50-share NSE Nifty too lost 34.50 points, or 0.33 at 10,458.35 after shuttling between 10,525.50 and 10,447.15.
A yellow glow is likely to stand out amid grey geopolitical clouds in 2023, with gold price projected to touch Rs 60,000 per 10 grams in the Indian market as more investors veer towards safe-haven assets. In a year where volatility was more a norm than an exception, gold prices in the international market oscillated from a peak of $2,070 per ounce in March to a low of $1,616 per ounce in November and is steadily recovering since then, according to market experts. At the beginning of 2022, gold prices were around $1,800 an ounce.
Infosys was the top gainer in the Sensex pack, rising over 2 per cent, followed by Bajaj Finance, HCL Tech, Tata Steel, Tech Mahindra and NTPC. On the other hand, Maruti, Sun Pharma, HUL and ITC were among the laggards. Nifty rose 122.15 points to 17,343.55.
In the absence of major domestic events, equity markets will be driven by global trends, foreign fund flows and movement in the Brent crude oil, analysts said. The major global events this week are the European Central Bank interest rate decision and China's inflation rate, they added. "Indian equity markets are outperforming most of their global peers and trying to show resilience despite weak global cues.
With the 'busy credit season' which witnesses a spurt in loan demand going up, it would be good to lower the rates ahead of it
Retail inflation crossed the RBI's comfort level and rose to 5.21 per cent in December on increase in prices of food items.
Gold prices hit record high in the third week of March as fears of bank collapses and high inflation led investors to the traditional safe haven. Gold prices are often inversely correlated to dollar strength because the international price is dollar-denominated. The Federal Reserve's (Fed's) stance indicates that the dollar may appreciate further since it is prepared to keep pushing up policy rates. But demand for gold is also up - the World Gold Council claims central banks are buying in addition to private demand.
Among Sensex stocks, Tata Motors rose the most by 2.79 per cent. NTPC, Reliance Industries, Infosys, TCS, HDFC twins, Tata Motors, ITC, Power Grid and Bajaj Finserv were among the major gainers. Tata Steel fell the most by 1.22 per cent. L&T, Sun Pharmaceuticals, IndusInd Bank and Ultratech Cement were among the losers.
Gold prices in the country may even dip to Rs 20,500 per ten grams.
Gains in IT shares and Bharti Airtel helped offset losses in HDFC Group shares.
'For someone who wants to invest for the future or his family, diversification is necessary.' 'Diversify across asset classes -- equities, gold, real estate, fixed income, commodities, and even cryptocurrency.'
Total market capitalisation of BSE listed firms stood at Rs 101.49 lakh crore on March 31.
Reserve Bank of India Governor Bimal Jalan said on Friday that there was no proposal to lower the short-term benchmark repo rate now.
India has always been a good bet in relative terms during crises/turbulent times in emerging markets (EMs).
Yes Bank was the biggest gainer in the Sensex pack, rallying 10.94 per cent. Other gainers included Sun Pharma, IndusInd Bank, L&T, ICICI Bank, Maruti, Bajaj Auto, Tata Motors and ONGC, rallying up to 4.01 per cent.
Achieving inflation target of 4 per cent, recovery after remonetisation and hardening profile of oil prices are some of the risks which the RBI is watching closely, says Gaurav Kapur.
From the Sensex pack, Tata Motors, Sun Pharma, Wipro, Tata Consultancy Services, UltraTech Cement, Tech Mahindra, Bajaj Finserv, HCL Technologies, Infosys and IndusInd Bank were the major laggards. NTPC, Power Grid, Reliance Industries, Tata Steel, HDFC and HDFC Bank were the major winners.
The Reserve Bank of India (RBI) is expected to hold its policy interest rate at 6.75 per cent next week to stifle inflation.
'It is less dependent on imported capital.'
Indian equity markets registered their highest single-day percentage gains since early October.
The BSE Sensex was among the world's best performers in 2014, rising almost 30 per cent after Prime Minister Narendra Modi took office on promises of reforms to boost growth
The broader NSE Nifty reclaimed the key 10,100-mark and touched a high of 10,155.65, before finally settling at 10,124.35
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