Raamdeo Agrawal on who’s protecting Nifty from falling down drastically

“Domestics are not letting the markets go down drastically. FIIs are not letting it go up phenomenally. It’s a Tug of war between FIIs and Domestics. The earnings growth will actually decide the direction of the market. I am optimistic about earnings growth,” Agrawal tweeted.

While domestic investors have been buying incessantly, foreign investors have been selling Indian equities for the 10th month in June. Altogether, they have sold equities worth over Rs 2.2 lakh crore in the ongoing sell-off phase.

Agrawal, the chairman and co-founder of Motilal Oswal, had earlier said there is no reason for FIIs to sell Indian stocks except for the valuation gap. “Either they have to accept the premium of Indian markets or they may wait for valuations to go down. We will have to wait and watch,” he had said recently.

Headline index Nifty, which ended below the 16,000 mark today, has lost nearly 10 per cent of its value in 2022 so far. However, unlike the US market, Indian headline indices – Sensex and Nifty – did not fall into bear grip even when pessimism was at its peak in June.

Several market experts have credited domestic investors, led by mutual funds, for protecting India from global meltdown. Mutual fund data showed that SIPs have been quite robust, with an average inflow of about Rs 12,000 crore in the last six months.