FII/FPI and DII Transactions: Foreign Investors Sell Indian Equities, Local Institutions Buy

Market Volatility Continues as Foreign Investors Sell Indian Equities

Foreign investors (FIIs/FPIs) net sold Indian equities worth Rs 1,711 crore on April 13, according to provisional exchange data. In contrast, domestic institutional investors (DIIs) net bought shares worth Rs 2,432 crore on the same day.

The trading session saw DIIs purchasing shares worth Rs 16,612 crore and selling shares worth Rs 14,180 crore. On the other hand, FIIs bought shares worth Rs 15,382 crore and sold shares worth Rs 17,365 crore.

Year-to-Date Net Sales

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The year so far has seen FIIs net sell shares worth Rs 2.11 lakh crore, while DIIs have net bought shares worth Rs 2.76 lakh crore.

Market Performance

Indian markets are likely to remain volatile in the near term, with limited scope for relief until meaningful progress is seen in the West Asia conflict. Following the breakdown of US-Iran peace talks over the weekend has heightened concerns over a prolonged standoff. The absence of an agreement has led to a sharp rise in crude oil prices and a weakening rupee, which could keep foreign fund flows under pressure. Additionally, the ongoing earnings season is expected to add to market volatility, keeping sentiment cautious.

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Market experts have noted that the ongoing conflict and its impact on crude oil prices will be key factors in determining the market's near-term direction. The ongoing earnings season is also expected to add to market volatility, keeping sentiment cautious.

Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services, noted that Indian markets declined sharply on Monday but recovered from day's lows, with the Nifty falling over 2% amid a confluence of global and domestic headwinds, before trimming losses on value buying at lower levels. The initial decline was driven by heightened geopolitical concerns after US-Iran negotiations failed, raising doubts over the ceasefire and fuelling fears of a prolonged conflict.

Crude oil prices surged sharply, with Brent rising 7.5% to $102 per barrel following US signals of a blockade of the Strait of Hormuz, is expected to tighten global oil supply and increase costs for India, escalating concerns over supply disruptions. Weak global cues and a depreciating rupee (93.4/USD) further added to the pressure. However, markets recovered from day's lows on value buying and selective support from financials and key sectors, despite prevailing negative sentiment. Nifty closed at 23,842 (-0.8%), while broader markets also recovered from their lows, with the Midcap100 and Smallcap100 ending down 0.5% and 0.4, respectively. Sectorally, PSU Banks, Auto, IT and Oil & Gas emerged as the worst performers.

Market experts believe that while intermittent recoveries may emerge on value buying, the broader trend is likely to stay cautious, with near-term direction dependent on developments in the West Asia conflict, movement in energy prices and foreign fund flow trends.