Stock Market: Foreign bears wrestle desi bulls ahead of Budget


Photo credit Ministry of Finance

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By S Jha

New Delhi, January 31: In two days, the foreign institutional investors have sold a net of Rs 12,239 crores of equities. The domestic institutional investors have broadened their war chest, rising to the occasion to the bear attack of the foreign fund houses. On Tuesday, the battle gained another dimension as the family business houses bailed out the Adani FPO to keep the India Inc pride intact.

The actions for two days in the run up to the Union Budget have been a trailblazer. Scales have tilted during the trading session. Bears have dug deeper into the fleshes of the bulls. But the bulls have also sought to come roaring back, only to be pushed back by the ferocity of shorting by the foreign fund houses. In this battle, with no victor yet in sight, the stock markets will watch Finance Minister Nirmala Sitharaman present her fifth Budget on Wednesday with bated breath.

The Economic Survey has dropped enough hints that the people may stay patient, for the government will not be splurging to buy high growth. Fiscal consolidation with space for social measures will stay the theme. Yet, Budget will reveal its details only on Wednesday. With the Narendra Modi government having shown signs of fiscal prudence amid buoyant tax collections – direct and indirect, the government indeed has creative space to give a direction to the economy amid global growth stress.

The Bank Nifty showed signs of life in the Tuesday session, as State bank of India led the recovery charge, gaining over three per cent. SBI had been battered in the short-selling bear attack on the Adani Group of companies. However, the SBI failed to get support from other heavyweights such as HDFC Bank, Kotak Mahindra Bank, ICICI bank, etc.

Ahead of the Budget, theme-based stocks gained strongly, supported by stellar quarterly results. Data Patterns and KPI Green stood out in the day’s session, making handsome gains. Data Patterns is riding Defence Aatmanirbharta. KPI Green is cashing in on the solar energy push. Market participants are expecting Sitharaman to make scope for further push in the defence, green energy sector. Mahindra and Mahindra was another star of the day. Tata Motors continued its march after the stellar quarterly result. The IT stocks were under stress. Similar was the case with the metal and pharmaceutical scrips.

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