Indian stocks fall slightly on profit booking, Sensex still above 60,000



New Delhi: Indian equity indices started Thursday’s session with minor losses mostly due to profit booking after the recent bull run.
Barring today’s marginal losses, the latest bull run in Indian equities has continued for five weeks at a trot. As of 9:21 a.m., Sensex was trading at 60,135.12 points, down 125.01 points or 0.21%, while Nifty was trading at 17,917.60 points, down 26.65 points or 0.15%.
Relevant to mention here, the benchmark Sensex hit the psychologically crucial 60,000 mark on Wednesday after more than four months. A slight moderation in inflation, both in the United States and India, coupled with a new influx of foreign funds into Indian capital markets, instilled positive sentiment among investors.
“Lower inflation has increased the possibility of a soft landing for the US economy. In India, lower inflation, lower crude, strong growth momentum, good monsoon and especially the FIIs that are becoming regular buyers have turned sentiments in favor of the high valuation, however, is a concern,” said vK Vijayakumar, chief investment strategist at Geojit Financial Services.
Until early July, Foreign Portfolio Investors (REITs) had been steadily selling stocks in Indian markets over the past nine to ten months for a variety of reasons, including monetary policy tightening in advanced economies, growing demand for dollars and the high yields of US bonds. They have withdrawn shares worth Rs 175,653 crore so far in 2022, according to NSDL data.
In July, however, they were the net buyer with a total purchase of shares worth Rs 4,989 crore. So far in August, they have bought shares worth an additional Rs 36,716 crore, according to the data.
Meanwhile, the benchmarks – Sensex and Nifty – are up nearly 10-11% during the current rally on a cumulative basis, largely recouping all of the losses incurred so far in 2022. Shares’ latest rally has enriched Indian investors by around Rs 25 trillion.
“While the domestic economy and earnings have shown strong resilience, we remain cautious on current valuations and suggest a laddered buying approach,” said Kedar Kadam, director of listed investments at Waterfield Advisors. (ANI)