FIIs offload over ₹3,000 cr in Indian equities ahead of US Fed policy decision

As per the NSE data, FIIs cumulatively bought ₹15,769.17 crore of Indian equities, while they sold ₹18,879.86 crore — resulting in an outflow of ₹3,110.69 crore. Meanwhile, DIIs infused ₹12,082.64 crore and offloaded ₹10,144.07 crore, registering an outflow of ₹1,938.57 crore.

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On Wednesday, domestic equity benchmarks Sensex and Nifty settled with losses amid mixed global cues. US bond yields surging to 16-year high levels and fears of high crude oil prices fueling commodity inflation also hit the investor sentiment, apart from anticipations of the US Fed policy decision, according to analysts.

The two-day Federal Open Market Committee (FOMC) meeting began yesterday (September 19) and its outcome is due later today. Besides the US Federal Reserve, the BoE (Bank of England) and the BoJ (Bank of Japan) are also scheduled to meet this week.

Chairman Jerome Powell-led FOMC is widely expected to keep the interest rate unchanged after having raised its policy rate by 525 basis points since March 2022 to the current 5.25 per cent-5.50 per cent range, despite persistent US inflation rate levels exceeding the central bank’s target range while the US economy remains resilient.

Sensex closed with a loss of 796 points, or 1.18 per cent, at 66,800.84 while the Nifty ended below the 20,000 mark at 19,901.40, down 232 points, or 1.15 per cent. Mid and smallcaps also ended in the red but they still outperformed the benchmark Sensex. The BSE Midcap index dropped 0.33 per cent while the Smallcap index ended 0.51 per cent lower.

‘’Today, both Nifty and Sensex experienced profit booking, largely attributed to a sharp sell-off in HDFC Bank following its analyst meeting. During the meeting, concerns were raised about potential margin pressure and the asset quality post-merger of HDFC twins.,” said Parth Nyati, Founder at Tradingo

‘’Global markets exhibited caution in anticipation of the upcoming Fed meeting. Factors such as increasing US bond yields, rupee weakness, a surge in crude oil prices, and selling by FIIs further contributed to the challenges faced by our markets,” added Nyati.
 

Where are markets headed?

‘’From a technical perspective, Nifty and Sensex have identifiable immediate support levels at 19,900 and 66,900, respectively. If these levels are breached, we may witness additional profit booking, potentially leading towards 19,640 for Nifty and 66,000 for Sensex,” said Nyati.

Updated: 20 Sep 2023, 07:16 PM IST