FPI flows may remain volatile in the near term, feel analysts

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Also Read- RIL share price hits record high; mcap tops ₹20 lakh crore for first time; what should investors do? There is uneasiness in the large traders including High and medium net worth Individuals too, as was visible in trade on Monday. The market saw steep corrections despite Foreign Portfolio investors (FPI) and Domestic institutions remaining net buyers.

Large traders including HNI's resorted to selling in mid-caps, small-caps and public Sector undertakings (PSUs), said experts. The sentiments had been impacted with correction in broader indices and hence at some point of time profit booking was being anticipated by large traders in mid-cap, small-caps and even PSU stocks.

The Q3 results have also not been supportive for stocks that had seen sharp rally pointed out Deepak Jasani, Head of retail research, HDFC Securities Ltd. The surge in margin requirements prompted retail investors to decrease exposure rather than inject additional funds, primarily impacting mid- and small-cap stocks, said Vinod Nair, Head of Research, Geojit Financial Services .

This pattern is anticipated to persist momentarily, given high level of margin funding and their historically elevated premium relative to large-cap, said Nair. Maintaining this premium valuation may prove challenging for the broader market, as corporate earnings are forecast to decelerate due to operational margin moderation, feels Nair.

Consequently, large-cap stocks are projected to outshine the broader market during this consolidation phase, added Nair The FPI who had been buyers on Monday however are net sellers worth ₹28488 crore year to date ill 12Th February as per NSDL data. The flows may also not remain supportive since bond yields have again started rising in