Street signs: Gruh Finance shares, Nifty may consolidate in Sept, and more

Nifty may consolidate in Sept

The benchmark Nifty50, which slid 1.8 per cent in the August expiry series, may remain range-bound in the coming weeks, with more stock-specific action. Derivatives analysts said rollovers were below three-month average and a majority of the shorts formed in the last series were out of the system. The Nifty has a downside support at 10,800-10,900 levels and can head to 11,500-11,600, if it crosses 11,150-11,200. The data shows that foreign portfolio investors (FPIs) remain bearish. In the past series, FPIs rolled over their short positions in index futures, with their long-short ratio dipping considerably. Global concerns on trade war and Centre’s steps to revive the domestic economy will dictate market movement.

Firms with high foreign holding rally  

The rollback of surcharge hike on FPIs has boosted share prices of a number of Nifty 100 companies, where FPI holding has been high traditionally. Housing Development Finance Corporation (HDFC), which had the highest foreign investment of 75 per cent as on June 30, has rallied six per cent in the past week. Banks with high FPI stake — HDFC Bank, ICICI Bank and IndusInd Bank — have surged 3-6 per cent as well. With acute polarisation of the market and institutional investors focusing on select names, these companies may continue to benefit from any increase in FPI flows.

FPIs, MFs lap up Gruh Finance shares

HDFC’s sale of a 9-per cent stake in Gruh Finance on the secondary market saw huge appetite among mutual funds (MFs), alternate investment funds (AIFs) and FPIs. Aberdeen, Nomura, Goldman Sachs, T Rowe and other FPIs bought close to Rs 1,000 crore worth of shares of Gruh Finance, while Axis MF, SBI MF, BNP Paribas MF and Kotak MF put in Rs 252 crore. AIFs of Avendus and IIFL also invested in the housing financier. Gruh, a quality stock according to analysts, has seen its share prices fall 22 per cent in 2019. The company will soon merge with Bandhan Bank.

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