Hi
Today I am giving FII data as indicated by SEBI which includes both NSE and BSE equity and debt.
Reporting Date-- Debt/Equity-- Gross Purchases(Rs Crores)-- Gross Sales(Rs Crores)
Net Investment (Rs Crores) Net Investment US($) million at month exchange rate
02-JUN-2006--- Equity-- 2317.80-- 2600.00--
(282.20)--
(62.80)
---Debt ---39.40--- 20.00 ---19.40--- 4.30
The above report is compiled on the basis of reports submitted to SEBI by custodians on 02-JUN-2006 and constitutes trades conducted by FIIs on and upto the previous trading day.
From above data it is clear that now FIIs have acclerated their purchases but so their selling has also increased. Net sales increased to R. 282.20 crs.
a jump of about Rs. 97 crs.
Now just a thought. If FIIs know that valuations are right would they let us know in advance? This would spoil their party as too many people will be with profit when it all ends again. Just as Nomura didnot talk about valuation till it reached 12600 they would not let us know if valuations are right. Their Buy figures are intriguing. Why they are buying if valuations are not right? If market were to tank further whatever stocks are being brought will end up much lower and they would incur loss.
Now another question if they sell within one year are they going to pay LTCG tax? Mauritius root is fine. No tax. But what about rest. Nomura figures don't stand anywhere as per the Powerpoint presentation. UBS made more profit then may heavy weights. But interms of investments there are other funds that are big boss. Are they also playing Japanese roullette?
I think they are rotating their sectors and taking some profit out after jacking it up by 20% more than the fair valuation. In any case when they sell it would always lower the market. Such is the extent of their meagre selling by normal standard. 3.5 % should not ring alarm bells. It has done mostly for those who invested in the last leg of the rally.
Long term portfolio would be in good health even now and it will be an opportunity for those willing to invest. Their cost will be less.
But , should retail investors invest now? I think not.
Why? because undercurrents are there now and on analysis it seems fine but
global cues are still not there. Just before FIIs would become net buyer, global cues would come for certain.
So I think wait and watch on the sidelines of this drama.
Regards
Pankaj