Foreign institutional investors (FIIs) ended May month with a bang by making the biggest single-day buying of the month on Wednesday. However, domestic institutional investors (DIIs) closed the month as net sellers. FIIs continued to buy despite Sensex and Nifty 50 closing on a bearish note. Overall, in May, FIIs have made the strongest buying of 2023 so far.
As per NSE data, FII buying value stood at a whopping ₹65,024.36 crore and selling value at ₹61,618.46 crore — resulting in an inflow of ₹3,405.90 crore in Indian equities on Wednesday.
On the other hand, DIIs bought ₹11,726.46 crore worth of equities on the last trading day of May, while they sold ₹14,254.98 crore. Hence, they posted an outflow of ₹2,528.52 crore on May 31st.
With that, FIIs stay as net buyers in May with an inflow of ₹27,856.48 crore — which is the highest monthly buying of 2023 as of now. DIIs, on the other hand, are net sellers with an outflow of ₹3,306.35 crore in May.
On May 31st, Sensex settled the day by falling 346.89 points or 0.55% to 62,622.24. Nifty 50 dipped by 99.45 points or 0.53% to close at 18,534.40.
Nevertheless, Sensex held above the 62,600 mark and Nifty 50 stayed over the 18,500 level — hence maintaining their outperformance compared to other Asian peers and developed markets.
On the latest market performance, Ajit Mishra, SVP – Technical Research, Religare Broking said, “Markets witnessed profit taking and shed over half a percent, tracking mixed cues. After the initial downtick, the Nifty index traded with a negative bias for most of the session however a marginal rebound in the final hours trimmed some losses and it finally settled at 18,534.40 levels. Pressure in the energy, banking, and metal pack was weighing on the sentiment while pharma and realty showed resilience and ended higher. Amid all, the broader indices showed noticeable strength and gained in the range of 0.4%-1%.”
Overall, in May month, Sensex climbed by at least 1,267.5 points or 2.07%. While Nifty 50 zoomed by nearly 387 points or 2.13%.
Going ahead, Mishra said, “Global headwinds, especially from the US markets, are causing intermediate volatility however the positional up trend is still intact. Considering the scenario, it is prudent to focus on position management while maintaining a positive bias.”
Also, Mitul Shah – Head of Research at Reliance Securities said, the IMD has reiterated its previous forecast of a normal monsoon (96% of LPA) this year. This augurs well for the agriculture and allied sectors and should help boost kharif output. It will boost farm income and will be a tailwind for overall rural consumption benefitting sectors such as automobiles, fertilizers, agrochemicals, and FMCG. It will also help tame inflation and boost hopes of a dovish monetary policy in 2HFY24.”
Shah added, “Globally, the Fed minutes meanwhile have offered some soothing words, indicating that additional policy firming may not be required as it could take a toll on growth. But at the same time, Fed members acknowledged the challenge on the inflation front, maintaining that the fight against rising prices is far from over. Automobile stocks will also be in focus ahead of the May sales data which will start tricking in from tomorrow. Brent crude has corrected sharply overnight and is now trading at $72/barrel.”
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Updated: 31 May 2023, 09:07 PM IST