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Q1 earnings, India-US trade talks outcome to drive mkt sentiments: Analysts
Q1 earnings, India-US trade talks outcome to drive mkt sentiments: Analysts

Business Standard

time3 days ago

  • Business
  • Business Standard

Q1 earnings, India-US trade talks outcome to drive mkt sentiments: Analysts

Trading sentiment in the stock market this week will be guided by quarterly earning announcements from blue-chips such as Infosys and Bajaj Finance, the outcome of India-US trade talks and global cues, analysts said. Markets may on Monday react to the quarterly results of three heavyweights - Reliance Industries, HDFC Bank and ICICI Bank, an expert said. India's most valuable company Reliance Industries on Friday reported its highest-ever quarterly profit of Rs 26,994 crore for the June quarter, reflecting a growth of 78.3 per cent over the year-ago period, driven by consumer businesses and investment sales. "All eyes will remain on the ongoing earnings season, with a series of major results lined up. Investors will first react to the results of three heavyweights Reliance, HDFC Bank, and ICICI Bank during early trades on Monday. In the sessions that follow, several prominent companies including Infosys, Dr Reddy's Laboratories, Bajaj Finance, Nestle India are scheduled to announce their quarterly results. "Globally, market participants will monitor trade deal updates, which could influence FII flows and currency movements. At the same time, uncertainty persists as global markets recalibrate expectations for Federal Reserve rate cuts, amid sticky inflation and trade-related tensions," Ajit Mishra SVP, Research, Religare Broking Ltd, said. Meanwhile, HDFC Bank on Saturday posted 1.31 per cent decline in its consolidated net profit to Rs 16,258 crore for the June 2025 quarter. ICICI Bank reported a 15.9 per cent jump in consolidated net profit to Rs 13,558 crore for the quarter. "As we step into a new week, the market is brimming with various domestic and global macroeconomic indicators that are expected to sustain its momentum. On the domestic front, investors will keep a close eye on the Q1 earnings of key companies such as Eternal, UltraTech Cement, Infosys, Bajaj Finance, Nestle among others, as they are scheduled to announce their financial results," Pravesh Gour, Senior Technical Analyst at Swastika Investmart Ltd, said. India and the US teams concluded the fifth round of talks for the proposed bilateral trade agreement (BTA) in Washington on July 17. The negotiations were held for four days (July 14-17) in Washington. These deliberations are important as both sides are looking at finalising an interim trade deal before August 1, which marks the end of the suspension period of Trump tariffs imposed on dozens of countries, including India (26 per cent). Siddhartha Khemka, Head - Research, Wealth Management, Motilal Oswal Financial Services Ltd, said, the prolonged wait for the IndiaUS trade deal ahead of the looming August 1 tariff deadline, is keeping investors on the sidelines. Investors will also track trading activity of Foreign Institutional Investors (FIIs) and movement of crude oil prices. Last week, the BSE benchmark tumbled 742.74 points or 0.90 per cent, and the Nifty declined by 181.45 points or 0.72 per cent.

Learn With ETMarkets: Can retail SIPs replace FII flows as India's market backbone?
Learn With ETMarkets: Can retail SIPs replace FII flows as India's market backbone?

Time of India

time4 days ago

  • Business
  • Time of India

Learn With ETMarkets: Can retail SIPs replace FII flows as India's market backbone?

The consistent rise in SIP inflows is more than just a reflection of growing retail participation. It is increasingly becoming a crucial source of liquidity, helping markets absorb shocks and remain resilient — even in periods of global uncertainty. In this article, we explore how rising SIP inflows are shaping market dynamics and contributing to long-term stability. Explore courses from Top Institutes in Select a Course Category Design Thinking Others Cybersecurity Artificial Intelligence Data Science Data Science CXO Public Policy MBA Finance Technology PGDM Degree Healthcare Management healthcare Digital Marketing MCA others Product Management Operations Management Project Management Data Analytics Leadership Skills you'll gain: Duration: 22 Weeks IIM Indore CERT-IIMI DTAI Async India Starts on undefined Get Details Skills you'll gain: Duration: 25 Weeks IIM Kozhikode CERT-IIMK PCP DTIM Async India Starts on undefined Get Details Record SIP Inflows Reflect Strengthening Retail Engagement In June 2025, SIP inflows reached an all-time high of Rs 27,269 crore, up 2% from Rs 26,688 crore in May — marking the first time inflows have crossed the Rs 27,000 crore mark. The SIP Assets Under Management (AUM) also rose to Rs 15.30 lakh crore from Rs 14.61 lakh crore during the same period. The number of SIP accounts touched a record 8.64 crore in June, up from 8.56 crore in May. New registrations also continued to rise, with 61.91 lakh SIPs initiated in June — compared to 59.14 lakh in May and 46.01 lakh in April. Overall retail participation saw a significant uptick. Mutual fund folios under equity, hybrid, and solution-oriented schemes stood at 19.07 crore in June, compared to 18.84 crore in May. Retail AUM under these categories rose to Rs 4.43 lakh crore from Rs 4.22 lakh crore over the same period. Live Events DIIs Gain Influence Amid Global Pullbacks The first half of 2025 marked a notable divergence in investment flows. Domestic Institutional Investors (DIIs) infused Rs 3.44 lakh crore into Indian equities — the highest since 2017 — while Foreign Institutional Investors (FIIs) withdrew Rs 82,389 crore. Despite global headwinds, the Nifty delivered positive returns of approximately 5.5% in H1 2025. Most sectoral indices posted gains, with defence and financial services leading the charge. This resilience highlights the growing strength of domestic capital in cushioning external volatility. Further, DII ownership in Nifty200 companies rose to 17.4% as of March 2025 — the highest level since June 2021. In contrast, FII ownership declined to 17.35%, its lowest since June 2020. This gradual shift underscores the rising influence of domestic investors in shaping India's market trajectory. A key driver of this transformation has been the surge in SIP inflows, which provide a steady channel of capital to DIIs, helping counterbalance FII-led volatility. How SIP Inflows Contribute to Market Stability SIP inflows bring several structural benefits that enhance market stability: Steady Capital Inflows: SIPs ensure a predictable monthly stream of funds into equities, reducing volatility caused by abrupt institutional movements. Reinforced Investor Confidence: Rising participation reflects growing trust in India's long-term economic prospects, promoting patient capital over speculative trading. Reduced Dependence on Foreign Capital: Domestic inflows offer a buffer against FII outflows during global uncertainty, mitigating sharp market declines. Improved Liquidity: Consistent buying interest enhances overall market liquidity and supports more efficient price discovery. Long-Term Orientation: SIPs promote goal-based, long-horizon investing, making funds less prone to panic exits during short-term corrections. Broader Participation: Millions of retail investors now engage with equity markets via SIPs, reducing concentration risk and making the market more resilient. Resilience During Uncertainty: Despite significant FII outflows in H1 2025, strong domestic flows ensured the market remained on stable footing. SIP Stoppage Ratio – A Metric Worth Watching While inflows remain strong, the SIP stoppage ratio — a measure of the number of SIPs discontinued relative to new registrations — rose to 77.77% in June 2025, up from 72.12% in May and 58.68% in June 2024. April 2025 saw a sharp spike in the ratio to 297%, as 136.99 lakh SIPs were discontinued compared to 46.01 lakh new registrations. Throughout Q1CY25, the stoppage ratio consistently remained above 100%. Though this may seem concerning, not all SIP closures point to negative sentiment. Many investors complete predefined SIP tenures or switch schemes as part of strategic rebalancing. Still, in CY25 alone, nearly 112 lakh net SIPs were closed. Nomura reports that January saw a net negative of 5 lakh SIPs, while February, March, and April witnessed net closures of 10 lakh, 11 lakh, and nearly 116 lakh respectively. Monitoring this ratio remains important in assessing evolving investor behaviour and sentiment. Looking Ahead Systematic Investment Plans have evolved from being a retail savings tool to becoming a vital structural support for Indian capital markets. Their steady inflows provide a counterweight to global uncertainty, improving resilience and liquidity while expanding retail ownership. That said, while SIPs bring consistency, they are not immune to behavioural shifts. Extended underperformance or macroeconomic shocks could still influence inflow patterns and investor decisions. Nonetheless, with growing financial awareness, digital accessibility, and policy encouragement, SIP adoption is expected to remain strong — reinforcing the role of domestic capital in driving India's equity markets toward long-term stability and self-reliance. (The author is Vice President of Research, TejiMandi) ( Disclaimer : Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)

Citi downgrades to Indian equities to ‘neutral' from ‘overweight'; here's why
Citi downgrades to Indian equities to ‘neutral' from ‘overweight'; here's why

Time of India

time5 days ago

  • Business
  • Time of India

Citi downgrades to Indian equities to ‘neutral' from ‘overweight'; here's why

Brokerage firm Citi has cut down its rating on Indian equities to 'neutral' from 'overweight', pointing to expensive valuations and weaker earnings growth forecasts. 'India remains most expensive market (23 times) vs both its peers and its own average valuation,' the firm said in a note, even as it acknowledged that India's macroeconomic story is stronger than many of its peers and a favourable US trade deal is possible, ET cited the firm. However, it believes the outlook for earnings growth is 'no longer exceptional' given the current market levels. Citi continues to prefer China, Korea, and the Philippines, citing better earnings revision trends and more attractive valuations in those markets. Within India, Citi favours banks, NBFCs, healthcare, and telecoms, but maintains an underweight stance on IT services, metals, and consumer staples. 'A turnaround in FII sentiment (relatively favorable trade deal with US, consumption growth recovery, etc., could aid) could support valuations/performance,' the firm added. Meanwhile, Foreign Institutional Investors (FIIs) have intensified their selling activities in Indian equity markets, with net outflows occurring across five successive trading sessions. During this short but significant period, FIIs have pulled out Rs 10,169 crore, exceeding $1 billion in total sales. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Weather Tomorrow search Click Here Undo These figures incorporate the substantial outflow observed on July 17. The largest withdrawal was witnessed on July 17, with FIIs offloading Rs 3,671 crore, representing the second-highest single-day outflow within the recent five sessions. The most substantial single-day withdrawal amounted to Rs 4,495 crore, highlighting the considerable scale of FII departures from the market. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now

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