Mumbai, February 22: Market analysts report that while Foreign Institutional Investors (FIIs) continue to sell off in the Indian stock market, strong domestic signals are allowing Domestic Institutional Investors (DIIs) to provide robust support.
In the week ending February 20, FIIs recorded a net withdrawal of approximately ₹7,000 crores from the cash market. This period saw Market Volatility, highlighted by significant selling on February 13, which resulted in an outflow of ₹7,395 crores.
Vineet Bolinjkar, head of research at Ventura, stated, “Despite this, DIIs made net purchases exceeding ₹8,000 crores, offering substantial market support. Notable buying occurred on February 13 and 16. The benchmark indices faced pressure, with the Nifty closing down 1.41% at around 25,454 on February 19 due to global tensions and declines in the IT, financial, and auto sectors.”
However, on February 20, the market showed partial recovery, with selective buying pushing the Nifty back towards the 25,600 mark.
The interim trade arrangement between the U.S. and India has regained balance following the U.S. Supreme Court’s rejection of broad ‘reciprocal’ tariffs imposed under the IEEPA. Currently, the tariff impact is limited to 15%.
Market experts suggest that this creates short-term uncertainty for Indian exporters in sectors such as textiles, pharmaceuticals, gemstones, and machinery. Nonetheless, the situation is less stringent compared to previously proposed measures, leaving room for further negotiations.
Additionally, U.S. President Donald Trump has hinted at exploring alternative legal avenues to advance tariff policies, increasing policy uncertainty.
Meanwhile, the Sensex closed positively, recovering from the 82,000-82,500 range while maintaining key support levels. Should volatility increase again, the 82,000-81,800 range will serve as support, while resistance is noted at 83,500-84,000.
Experts indicate that market instability may persist. For the Nifty, strong support is at 25,300, with resistance at 25,700. Until clear bullish signals emerge, adopting a ‘sell on rise’ strategy may be prudent. Investors should monitor global cues and upcoming earnings closely.
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