Saturday, October 01, 2005

FII inflow to dictate trend

The next major trigger for the market is the Q2 earnings season which will kickoff shortly with Infosys unveiling its numbers on 11 October 2005. Profit taking may emerge on the bourses if the corporate earnings fail to meet market expectations.

There are also some concerns that the valuations may be stretched. The S&P CNX Nifty index current trades at a PE multiple of a little over 16.

FII inflow holds the key. The liquidity with FIIs remains strong. FIIs have been shifting money in favour of emerging markets due to low yield in the United States and Europe.

The cumulative FII inflow in September 2005 reached Rs 4,513.40 crore (till 28 September), on the top of an inflow of Rs 5,051.20 crore in August 2005.

The FII inflow for calendar 2005 so far (till 28 September 2005) has reached $ 8.56 billion, which has surpassed an inflow of $ 8.51 billion recorded in the whole of 2,004.

Liquidity has been intense with local mutual funds as well. The cumulative inflow of local funds in equities in September 2005 reached Rs 2,752.27 crore (till 28 September). This follows the inflow of Rs 2,292 crore in August 2005.

0 Comments:

Post a Comment

<< Home