By Aditya Raghunath
Investing.com -- The Indian markets are behaving in a strange manner since November 2 where foreign institutional investors (FIIs) have been net buyers every day while domestic institutional investors (DIIs) have been net sellers every day.
Ever since the news on U.S. elections and Donald Trump’s refusal to let go of the Presidency came into focus, India has been a favored destination for foreign institutions to park billions of dollars. In November FIIs bought Rs. 65,317 crores while DIIs sold Rs. 48,319 crores.
December has been no different. Until December 10, FIIs have bought equities worth Rs. 22,732 crore while DIIs have sold equities worth Rs. 16,267 crores.
India is one of the few countries in the world that hasn’t experienced a second wave of the COVID-19 virus. The US is struggling with over 15 million cases recorded and over 2,000 people dying daily. India is seen as a safe haven for now.
There has not been a single day since November 2 where FIIs have been net sellers. Similarly, DIIs haven’t been net buyers in this period. What happens when FIIs stop buying? Does the music stop? Will DIIs get into the game? What if FIIs start selling? Is there going to be a bear market on the cards?