New Delhi. On 26 September 2024, Nifty50 jumped 211.90 points, and the index closed at 26,216.05. Since then, the market has seen a continuous decline. 26 September (Thursday) was the day when foreign institutional investors (FIIs) bought, meaning they were net buyers that day, and after that, they were continuously selling to the Indian stock market by becoming net sellers. This selling lasted for a full 38 sessions. 38 sessions mean about two months. After being net sellers for the entire 38 sessions, the auspicious day came on 25 September, when FIIs once again emerged as net buyers. Has the auspicious time of the market started with an auspicious day? Let's understand.

Indian stock markets, excited by the bumper victory of the Bharatiya Janata Party in the Maharashtra elections, showed a tremendous rally on Monday. Sensex showed a jump of about 1,000 points, while Nifty also recorded a jump of about 300 points. Happy to see the result, FIIs also started buying in the market from lower levels and yesterday evening the overall data of FIIs was in the green mark. They made a total purchase of Rs 9,947.55 crore.

FIIs sold goods worth Rs 1,14,445.89 crore in the whole of October. Till last Friday, it seemed that November would also turn out to be red because foreign investors had not bought goods even on a single day till then. On November 25, the total purchase of FIIs was Rs 85,251.94 crore, while the total sale was Rs 75,304.39 crore. In this way, they made a net purchase of Rs 9,947.55 crore. Talking about the entire month (November) so far, FIIs have made a net sale of Rs 30,999.80 crore.

Why was this purchase triggered?
HDFC Bank performed brilliantly in Monday's trading session, with its share price rising 2.3 percent to close at Rs 1,785.6 per share. The main reason for this rise was the change in the bank's weightage in the MSCI (Morgan Stanley Capital International) index, and investors had been waiting for this for a long time. This change in weightage by MSCI was expected to bring an estimated investment of about $1.88 billion (Rs 15,500 crore) in HDFC Bank shares. This change was made in two phases. The first phase took place in August, in which foreign investment of Rs 15,000 crore (USD 1.8 billion) was expected. The second phase came into effect on November 25, which further increased the interest of foreign investors in HDFC Bank.

Other stocks will also benefit.
Apart from HDFC Bank, other companies are also in a position to benefit from the increase in weightage in the MSCI index. These include Kalyan Jewelers, Alkem Laboratories, and Oberoi Realty. The MSCI index is closely tracked by foreign investors, and the increase in weightage is likely to increase investment in these companies as well.

Will FII's buying continue?
According to Anshul Jain, Head of Research, Lakshmi Shreee Investments, this change in MSCI gave a big positive signal to the market. In the last session, heavy buying of Rs 9,947 crore was seen by foreign investors. This buying is strengthening the market sentiment. However, Jain said that it would be important to cross the level of 53,000 in Bank Nifty and 24,600 in Nifty. If this level is crossed, it will indicate a positive trend for the market. Till these technical levels are not crossed, investors should remain cautious.

In a report on November 24, market analysts at Motilal Oswal had indicated that the BJP-led NDA's electoral victory could help boost investor sentiment. "These election results, coupled with expectations of improving rural demand following a good monsoon and strong kharif yields, could set the stage for a low-risk rally," Motilal Oswal said. In a conversation with Moneycontrol, Nilesh Shah of Kotak AMC had said that the election results could boost confidence in the government's ability to push through reforms. "It could also help restore foreign investor confidence, as many foreign investors were sell-off and bearish on India in the last 2 years," he added.