Expert Zone
Straight from the Specialists
Why FIIs are dumping India
(Any opinions expressed here are those of the author and not of Thomson Reuters)
The Indian stock market is in a tizzy as foreign institutional investors (FIIs) seem to have pressed the sale button. Securities and Exchange Board of India (SEBI) data shows that while there was a considerable slowdown in FII inflow in March, we are seeing an outflow in April.
While net FII inflow in the equity markets remained above $4 billion for each month between December 2012 and February 2013, the net inflow for March was reduced to $1.68 billion. The trend reversed and during April 3-10, there was a net outflow every day, with cumulative outflow of $269 million during this period.
The outflow in April is small as compared to the over $25 billion inflow during 2012-13, but the trend is unmistakable. The euphoria that was generated after the government announced a series of policy measures (touted as big-ticket reforms) from September 2012 onwards has slowly died down as the magnitude of triple deficit (fiscal deficit, current account deficit and governance deficit) intensified. Hardly any of the announcements bore fruit.
There’s still no light at the end of the tunnel for the land acquisition bill. FDI in multi-brand retail is still not a foregone conclusion and may yet face a roadblock when the budget session of parliament reconvenes.
The stock market’s delayed response to Budget 2013
(Any opinions expressed here are those of the author and not of Reuters)
Finance Minister P. Chidambaram tried to humour the market in his budget by cutting the Securities Transaction Tax (STT) which had been one of its sore points. But the market was not amused. The Sensex continued to slide, indifferent to the budget which was presented with a lot of expectations.
This appears to be rather strange because the budget was well received by the industry, in spite of the increase in surcharge from 5 to 10 percent. It was possibly the realization that the finance minister lived up to his promise of cutting fiscal deficit to 4.8 percent which created an infectious confidence in growth revival.
India Markets Weekahead: RBI policy review to be catalyst for markets
(The views expressed in this column are the author’s own and do not represent those of Reuters)
This was a listless week with the Nifty in the same band of 5640 and 5720 as the previous week, closing about 20 points lower at 5664. The festival season has begun but the mood on the street remains cautious.
India market weekahead: Consolidation seen, earnings in focus
(The views expressed in this column are the author’s own and do not represent those of Reuters)
October has been touted as a difficult month for stocks, though for the Indian markets there didn’t seem to be anything stopping the repeat show of October 2011 until the flash crash on 5th.
