MUMBAI: FIIs continued with their selling spree, offloading Indian shares worth a provisional `7,631 crore Friday amid global markets selling off as a fallout from the Ukraine conflict. Investor wealth worth `4.42 lakh crore was eroded in Friday’s fall.
The FII selling has intensified over the past few days with no sight of a solution to end the conflict that has led to 1 million Ukrainians fleeing to bordering countries, crushing sanctions on Russia which has pushed crude oil to seven-year highs.
The Nifty closed down 1.5% at 16,245.35 while the Sensex shed 1.4% to close at 54,333.81. The losses on Nifty were led by Titan, Asian Paints, Maruti Suzuki, Tata Motors and Hero MotoCorp, which fell between 4 % and 5%. Fear gauge India Vix, which reflects traders’ anticipation of price swings, trades at an elevated 27.96, with a reading above 20 indicating heightened risk. Rajesh Palviya, technical head, Axis Securities, expects the markets to continue remaining under pressure amid “scorching “ commodity prices.
Hormuz Maloo, director, AFco Investments, said the market could break convincingly below the 16000 mark amid worsening geopolitical tensions. “A weaker rupee reduces FIIs’ dollar returns which drive more outflows, in turn putting more pressure on the rupee,” said Palviya, adding, “It’s a vicious cycle.”
The rising inflationary fears and safe-haven appeal pushed gold up 1% to `52,326 per 10 gm in intraday trades. Prices above `50,000 tend to slow physical market buying, said Surendra Mehta, national secretary of IBJA, a precious metals trade body.