Volatility Looms Over Indian Stock Markets Amid Foreign Investor Moves
Indian stock markets opened flat on Monday, with mixed performance in indices. Increased short positions by foreign investors signal continuing volatility, says VK Vijaya Kumar. While defence stocks rally, excessive valuations urge caution. Broader Asian markets remain weak, amplifying trader caution about global cues and future market trends.
- Country:
- India
On a typical Monday morning, Indian stock markets displayed subdued enthusiasm, opening on a flat note. The Nifty 50 index subtly rose by 6.40 points or 0.03%, settling at 25,026.20, whereas the BSE Sensex opened slightly lower, down 51.10 points or 0.06%, at 82,279.49.
Market analysts observed increased short positions by foreign investors in the derivatives segment during the last trading session, a move hinting at potential market volatility. VK Vijaya Kumar, Chief Investment Strategist at Geojit Investments, commented on the dynamics, identifying sustained FII inflows as the catalyst behind the current market rally. However, despite significant institutional buying of 14,018 crores, markets saw a decline, signaling growing foreign short positions and potential volatility.
Kumar also highlighted a surge in defence stocks but cautioned against their high valuations. Sectoral performance displayed a mix, with Nifty Auto up 0.55% and Nifty Pharma rising 0.49%, while Nifty IT lagged, trading in the red. Across broader Asian markets, sentiment weakened. Indices in Japan, Hong Kong, and Taiwan experienced declines, while South Korea's KOSPI fell over 1%, reinforcing trader caution amid mixed global signals.
(With inputs from agencies.)
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