FIIs' single day F&O addition at 11-year high
Subscribe to enjoy similar stories. A dramatic surge in purchases of index futures contracts and in cash buying by foreign investors on Friday signalled a sharp improvement in their sentiment towards India. The bullishness became apparent after the US Federal Reserve cut its policy rates by an outsized 0.5 percentage points on Wednesday.
Market watchers said this could mean an extension of the latest leg of the rally that got underway after the Union election results were declared on 4 June. Foreign institutional investors (FIIs) net purchased an additional 135,601 index futures contracts—Nifty and Bank Nifty—on Friday from the previous session. This is the highest single-day increase on a non-expiry day in 11 years, per data analytics firm IndiaCharts.
“The last time a similar huge addition was seen on a non-expiry day was on 10 September in 2013 when FIIs added 135,813 contracts," said Rohit Srivastava, founder of IndiaCharts. This net addition comes on top of the provisional ₹14,064 crore purchase in cash shares by FIIs on Friday due to global index provider FTSE rebalancing its ‘All World Index’ and the lower rate cycle signalled by the US Fed. “FII buying in cash and in derivatives suggests more legs to the rally after the Fed rate cut and signalling of a lower rate cycle," said Andrew Holland, CEO of Avendus Capital Public Market Alternate Strategies.
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