FPIs invest ₹378 cr in Indian stocks, snap 3-month selling streak; here’s why
Live MintForeign portfolio investors have finally reversed their selling streak this month, after emerging as net sellers in August, September and October on a sharp spike in US bond yields amid ongoing geopolitical tensions in the Middle East. Consequently the US bond yields have declined sharply with the 10-year benchmark bond yield correcting from 5 per cent in mid October to 4.40 per cent now,'' said Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. After the latest US Federal Reserve policy outcome on November 1, the US bond yields have sharply corrected to 4.66 per cent and still declining on Fed Chair Jerome Powell's dovish commentary. The rate-setting Federal Open Market Committee decided to keep the key overnight interest rates unchanged at 5.25-5.50 per cent - a 22-year high mark for the second straight meeting. ‘’The main trigger for this reversal in bond yields is the subtle dovish commentary from the Fed chief Jerome Powell that “despite elevated inflation, inflationary expectations remain well anchored.” The market has interpreted this statement as the end of the rate hiking cycle.