Impact of FPI’s inflow in the stock market


Consistent FII inflows, along with an optimistic RBI policy outcome and hopes of a faster roll-out of an antiCovid-19 vaccine is expected to give a further push to key domestic stock indices in the week ahead.

Lately, healthy inflows by foreign portfolio investors (FPIs)  have powered a rally in stock markets. The FIIs remained net buyers last week. They invested over USD2 billion in the equity segment. Besides, analysts pointed out that macro-economic signs showing sustenance of demand recovery after the festive season would be key to watch out for investors. They pointed out that expectations for an economic stimulus in the US and hopes for a vaccine to stop the virus will be the main focus in markets during the week ahead.

However, likely bouts of profit booking as well as expensive propositions will arrest any major upswing. “While the trigger of RBI policy is out of the way, markets globally now look forward to rising chances of an early US economic stimulus package,” said Deepak Jasani- Head of Retail Research at HDFC Securities. “Post a good weekly close, we may see some more upside in the early part of the week. Stocks that have seen a decent upside over the past few weeks are showing signs of fatigue and profit-taking. Attention may shift to stocks that have not performed to that extent so far.

” The Indian markets continued their rally for the fifth consecutive week ended on December 4, 2020 with benchmark indices hitting fresh record highs during the week supported by the global as well as domestic cues. Notably, the NSE Nifty50 closed the week higher by 2.2 percent and S&P BSE Sensex gained 2.1 percent.

Consistent FII inflows, along with an optimistic RBI policy outcome and hopes of a faster roll-out of an antiCovid-19 vaccine is expected to give a further push to key domestic stock indices in the week ahead.

Lately, healthy inflows by foreign portfolio investors (FPIs)  have powered a rally in stock markets. The FIIs remained net buyers last week. They invested over USD2 billion in the equity segment. Besides, analysts pointed out that macro-economic signs showing sustenance of demand recovery after the festive season would be key to watch out for investors. They pointed out that expectations for an economic stimulus in the US and hopes for a vaccine to stop the virus will be the main focus in markets during the week ahead.

However, likely bouts of profit booking as well as expensive propositions will arrest any major upswing. “While the trigger of RBI policy is out of the way, markets globally now look forward to rising chances of an early US economic stimulus package,” said Deepak Jasani- Head of Retail Research at HDFC Securities. “Post a good weekly close, we may see some more upside in the early part of the week. Stocks that have seen a decent upside over the past few weeks are showing signs of fatigue and profit-taking. Attention may shift to stocks that have not performed to that extent so far.

” The Indian markets continued their rally for the fifth consecutive week ended on December 4, 2020 with benchmark indices hitting fresh record highs during the week supported by the global as well as domestic cues. Notably, the NSE Nifty50 closed the week higher by 2.2 percent and S&P BSE Sensex gained 2.1 percent.

 

 



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