FIIs invest ₹456 crore in Indian stocks, DIIs infuse ₹8 crore even as US bond yields rise to 16-year high | Mint
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Business News/ Markets / Stock Markets/  FIIs invest 456 crore in Indian stocks, DIIs infuse 8 crore even as US bond yields rise to 16-year high
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FIIs invest ₹456 crore in Indian stocks, DIIs infuse ₹8 crore even as US bond yields rise to 16-year high

Bond yields are influenced by the Federal Reserve's interest rates. Experts say bond yields have been rising because of the current trend of higher interest rates.

Domestic markets settled lower for the third consecutive session todayPremium
Domestic markets settled lower for the third consecutive session today

Foreign institutional investors (FIIs) paused their selling spell on Friday, October 20, even as US bond yields rose to their 16-year high mark and domestic markets settled lower for the third straight session. The domestic institutional investors (DIIs) were also buyers and infused 8 crore in Indian stocks today.

As per the NSE data, FIIs cumulatively bought 13,645.57 crore of Indian equities, while they sold 13,189.36 crore --- resulting in an inflow of 456.21 crore on Friday. Meanwhile, DIIs infused 6,870.72 crore and offloaded 6,862.19 crore, registering an inflow of 8.53 crore.

The US 10-year Treasury yields are near their 16-year high level boosted by the prospects of another rate hike. Federal Reserve Chairman Jerome Powell on Thursday said that more interest rate hikes may be required to bring inflation down to a 2 per cent target because of a tight labour market and resilient US economy.

“Global equity markets reacted to concerns of rising interest rates, energy prices, and bond yields. Sensex 30 and Nifty 50 declined, while midcap and smallcap indices saw mixed performance. BSE Auto index outperformed. Stock movements were influenced by Q2FY24 earnings. Crude oil rebounded, and the 10-year US treasury yield rose, near 5 per cent,'' said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities.

Also Read: Global growth losing momentum; emerging markets facing currency depreciation, volatile capital flows: RBI MPC Minutes

Stock Market Today

Domestic equity benchmarks Nifty 50 and Sensex ended in negative territory for the third consecutive session on Friday, October 20, as concerns about potential interest rate hikes by the US Fed, and the ongoing war between Israel and Hamas kept investors on edge.

Nifty 50 today closed at 19,542.65, down 82 points, or 0.42 per cent while the Sensex ended the day at 65,397.62, down 232 points, or 0.35 per cent. Mid and smallcaps suffered bigger losses. The BSE Midcap index fell 1.02 per cent while the Smallcap index dropped 0.76 per cent.

"The added uncertainty stemming from West Asia tensions and the imperative for continued monetary tightening emphasized by the US Fed Chair created a layer of volatility in the market. While heightened oil prices and elevated US bond yields will impact the domestic monetary environment and operational metrics of the companies,'' said Vinod Nair, Head of Research at Geojit Financial Services.

Where are markets headed?

Geojit's Vinod Nair added that the varied results of blue-chip companies, influenced by subdued global and domestic demand, are steering the market towards a consolidation trajectory in the near term.

‘’Weak global cues combined with pressure in the key sectors are currently weighing on the sentiment and we don’t expect relief anytime soon. Traders should align their positions accordingly and continue with a hedged approach,'' said Ajit Mishra, SVP - Technical Research, Religare Broking.

Technical View: ‘’Technically, Nifty could find support at the 19,501 mark, while any uptick would be seen only if the index breaches its biggest hurdle at the 19,887 mark,'' said Prashanth Tapse, Senior VP (Research), Mehta Equities.

 

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.

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ABOUT THE AUTHOR
Nikita Prasad
Nikita covers business news and has been producing news on digital platforms since 2018. She writes on economy, policy, markets, commodities, industry. Her core areas of interests include infrastructure, energy, oil and gas, railways, and transport/mobility. She has worked for business news channels like Moneycontrol, NDTV Profit, and Financial Express in the past. If you have story ideas/pitches/reports or quotes/views to share, reach her at nikita.prasad@htdigital.in.
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Published: 20 Oct 2023, 10:23 PM IST
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