FIIs stay as net buyers for 6th day in row, invests ₹1,415 cr in equites on 4th May; DIIs inflow over ₹441 cr

Foreign institutional investors (FIIs) continued to show a healthy appetite for Indian equities for 6th day in a row with an investment of nearly ₹1,415 crore on Thursday. However, domestic institutional investors (DIIs) halted their 2-days losing streak and also pumped in more than ₹441 crore in domestic stocks. Sensex and Nifty 50 gained by nearly a percent today as traders take comfort from a dovish 25 bps hike from US Fed and commentary on the banking crisis.

In the latest session, Sensex jumped by 555.95 points or 0.91% to close at 61,749.25, while Nifty 50 surged by 165.95 points or 0.92% to finish at 18,255.80. The broad-based rally was seen across the board with midcap and small-cap stocks also advancing by nearly a percent. Banking and financial stocks emerged as top performers. Apart from Fed policy outcomes, it was also the consistent foreign funds' inflow that boosted sentiment.

As per NSE data, on Thursday, FIIs purchased ₹7,311.04 crore worth of equities and sold ₹5,896.31 crore, registering an inflow of ₹1,414.73 crore in the day.

Meanwhile, the DIIs' buying value was at ₹5,611.15 crore and the selling value stood at ₹5,169.59 crore -- resulting in an inflow of ₹441.56 crore.

On the previous day, FIIs bought ₹1,338 crore, on the contrary, DIIs sold ₹583.99 crore.

FIIs have been net buyers since April 26th. While DIIs have shown a mixed performance at the start of May.

Read here: Top gainers, losers in trade today: Bajaj and HDFC twins, Adani Ent; check full list here

On current market performance, Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities said, "The US Federal Reserve softening its stance over future rate hike prospects cheered investors' mood which triggered a fresh bout of buying in banking stocks. With India's growth indicators showing good signs of revival and crude oil prices staying lower, investors are betting big on local equities even as the haze over global economic growth persists."

European Central Bank on Thursday hiked its key interest rates by 25 bps as the inflation outlook continued to be too high for too long. This is in line with the rate action by US Federal Reserve on Wednesday.

On Wednesday, Fed continued on its path of achieving maximum employment and an inflation rate of 2% in the long run and accordingly raised the target range for the federal funds rate to 5 to 5-1/4 percent.

For Friday's trading session, Ajit Mishra, VP - of Technical Research, at Religare Broking said, "The surge in the index shows more leg to the prevailing up move before it settles for some consolidation. Apart from consistent buying in banking and financial majors, the rotational participation from other sectors is fueling the recovery now. We thus recommend aligning positions according to the trend, with a focus on stock selection."

Read here: How US Fed rate hike will impact Indian stock market today — explained

In three trading sessions of May so far, FIIs have overall invested ₹4,750.08 crore in the Indian market, while DIIs sold ₹536.48 crore broadly, as per Stock Edge data. In April month, the FIIs inflow stood at ₹5,711.80 crore and DIIs were also buyers with an investment of ₹2,216.57 crore.

In the short-term period, Gopal Kavalireddi, Head of Research at FYERS said, "With the quarterly results season on, all eyes are on earnings growth. Indian markets started moving higher since the beginning of the financial year, with record GST collections and healthy economic activity across many sectors. After three months of negative returns between December and February, March proved to be better. The broader markets showed sufficient positivity in April and a continuing trend in May, looking to deliver the best returns in almost six months.”

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.