Rising greenback and bond yields making it harder for FIIs to remain placed on D-Avenue

Amid a spurt within the US Greenback index and bond yields, overseas institutional buyers or FIIs are again to promoting mode on Dalal Avenue. Final Friday alone, FIIs dumped Indian shares price round Rs 2,900 crore, reveals NSDL information.

FIIs, which have been internet patrons to the tune of over Rs 51,000 crore final month, have purchased Indian equities price solely about Rs 8,368 crore thus far within the month.

“FII exercise has turned extremely unstable with alternate bouts of shopping for and promoting. In September until twenty third, FIIs purchased for 8 days and offered for 8 days within the money market. Elevated FII promoting has occurred in current days attributable to rising greenback and rising bond yields within the US,” mentioned Dr VK Vijayakumar, Chief Funding

Strategist at

.

Because the demand for the secure haven soared after the US Fed’s hawkish-than-expected stance, the US greenback index has now crossed the 113 mark, its highest stage in twenty years. The Indian rupee additionally breached the 81 mark towards the dollar consequently, final week.

Yields on the benchmark US 10-year Treasury stood at round 3.69%, their highest stage since 2010.

Analysts say FIIs are unlikely to purchase aggressively going ahead except the greenback index and US bond yields decline.

“In September, FPIs have been sturdy patrons in financials, autos and capital items and sellers in IT. If FPIs once more flip patrons, financials will once more emerge stronger since financials have sturdy basic assist,” Vijayakumar mentioned.