By laksh5382 
MUMBAI: Nifty snapped a three-day losing streak on Friday but recorded its longest weekly decline this year on sustained selling by foreign institutional investors (FIIs), chasing the stimulus-led recovery last month. Towards the end of 1920, they moved towards China. In the world’s second largest economy.
Analysts expect the intense battle between bulls and bears to continue amid weak earnings and subdued sentiment among direct retail investors.
Nifty closed 0.44% lower at 24,854.05, falling for the third consecutive week. However, on a daily basis, it broke a three-day losing streak and closed at 24,854.05, up two-fifths of a percent from a highly oversold position.
The recovery was led by the banking pack, which saw maximum FII selling in the first half of the month. ICICI Bank, Axis Bank and HDFC Bank contributed significantly to the 0.4% movement of Nifty.
“FIIs are selling and direct retail are not as confident as they were a few months ago, which is why we will see these peaks and troughs unless there is a sharp move,” said independent market analyst Ambrish Baliga.
He said, “Apart from FII outflows, the reason why selling is increasing is partly booking by direct retail investors, who were quite long in railways, defense and PSUs. They are perhaps not as confident. , as it was till a few months ago.” ,
The direct retail category includes investors who buy and sell from the cash market rather than using the mutual fund route.
FII selling continues
FII cash selling continued with temporary outflows 5485.70 crore, while DIIs made provisional purchases Shares worth Rs 5214.83 crore, BSE data shows. Due to this, FII sales have reached record level so far this month. Rs 83,186.7 crore, according to Friday’s data from NSDL and BSE.
“We expect market consolidation to continue due to mixed global cues and lack of domestic triggers,” said Siddharth Khemka, head of retail research at Motilal Oswal Financial Services. “However, stock-specific action will be seen driven by quarterly earnings results.”
The results season so far has not been very inspiring, with total earnings including banks and NBFCs growing at 2.86% year-on-year. Rs 66,286.45 crore in the June quarter as against an annual increase of 5.07%. 64139 crores.
The mood remains bearish so far this month due to weak earnings growth so far coupled with FII selling. This is reflected in the market-wide value of call options exceeding the record of put options 6.12 trillion on an outstanding basis, according to IndiaCharts founder Rohit Srivastava.
This means that traders are selling more call options on indices and stocks on a cumulative basis, with the confidence that the market will not rise, giving them a chance to pocket the premium paid by call buyers. .
Typically when markets are overbought, as evidenced by the low put call ratio, they reverse. However, Srivastava believes that any rise could be sold by FIIs and some retail participants.
“I think the medium term range for the market is 24600-25600, with support and resistance being tested from time to time,” he said.
NSDL data shows selling took place from the first fortnight of the month to October 15. 66,301 crore shares, comprising their total equity assets 75.65 trillion.