The Indian equity market started on a positive note on August 12, despite continued foreign institutional investor selling. This comes as a pleasant surprise to investors, who were concerned about the impact of FIIs offloading equities worth ₹3,398 crore on that day.
The market’s resilience in the face of FII selling highlights the growing confidence of Indian investors in their domestic market. It also reflects the strong fundamentals of the Indian economy, which continue to attract foreign investments despite recent challenges.
The Indian equity market has been on a rollercoaster ride in recent times, with the COVID-19 pandemic causing massive disruptions and uncertainties. In such a scenario, FIIs have been seen as a major source of stability for the market. However, their selling on August 12 could have caused panic among domestic investors. But, they have not let this affect their sentiment and have remained bullish on the market.
This positive start can be attributed to the strong financial results of many Indian companies, which have exceeded market expectations. This has boosted investor confidence and provided a much-needed respite to the market. Moreover, the recent policy measures taken by the government, such as the relaxation in FDI norms, have also contributed to the positive sentiment in the market.
Another factor that has helped the market to shrug off the FII selling is the increasing participation of domestic retail investors. They have been actively investing in the market, taking advantage of the dip in stock prices. This has balanced out the impact of FII selling and has helped to maintain the market’s positive trend.
Furthermore, the Indian government’s commitment to boosting the economy and the strong revival of major sectors like IT and pharma have also contributed to the positive start of the market. The government’s focus on infrastructure development and the various stimulus packages announced have instilled confidence in investors, both domestic and foreign.
The market’s positive start on August 12 has also been supported by the performance of the Indian rupee against the US dollar. Despite the volatility in global markets, the Indian rupee has remained stable, which has provided a sense of stability to investors.
It is worth noting that the market’s positive start has come in the midst of continued foreign institutional investor selling. This highlights the fact that domestic factors such as strong financial results, government policies, and participation of retail investors have a greater impact on the market than external factors.
While FIIs are an important source of investments for the Indian market, their selling cannot be a cause for concern. It is a part of their regular portfolio management strategy and should not be seen as a reflection of the market’s performance. Moreover, FIIs have a long-term positive outlook on the Indian market, as evident from their consistent investments over the years.
In conclusion, the Indian equity market’s positive start on August 12 is a testament to the resilience of Indian investors and the strength of the Indian economy. It also reflects the increasing confidence of both domestic and foreign investors in the Indian market. With strong fundamentals and government support, the Indian market is well-positioned to weather any challenges and continue its upward trend. Investors should remain optimistic and continue to have faith in the Indian market for long-term growth and returns.
