gfiles magazine

December 19, 2012

FII’s quest for market


STOCK DOCTOR
dr gs sood
FII’s quest for market
 
The market has increased by more than 20 per cent since the year began, mainly driven by foreign institutional investment (FII) inflows that exceeded US$19 billion (around Rs 1 lakh crore). However, I am unable to find an explanation for such a stellar performance of the Sensex with the economy going down or at least showing no signs of a significant revival. Is it because of the fact that abundant global liquidity is resulting in risk-taking, leading to massive inflows into the Indian market? Also, it is worth noticing that this has not caused a bull run, with only very selective sectors and stocks reaching new highs, with their growth being driven by noticeable FII activity. So, does it mean that domestic institutions and retail investors have been sellers and are not able to see what the FIIs have been banking upon? READ MORE

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