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Foreign investors have withdrawn nearly Rs 20,000 crore from Indian stock markets in just five trading days (November 4–8), continuing a trend of large-scale selling that began last month. Experts say investors are now moving their money to China, largely due to the high valuations presently prevailing in Indian markets. In early November, FPIs have offloaded as much as Rs 19,994 crore in Indian markets. The month prior, i.e., October, was one of the worst months in terms of foreign outflows, with FPIs making a net withdrawal of Rs 94,017 crore. Before this, Indian markets faced such a situation during the pandemic, when FPIs withdrew Rs 61,973 crore from equities in March 2020. <h2>Why Are Investors Leaving? </h2>According to Himanshu Srivastava of Morningstar Investment Research India, two main factors are driving this exodus. First is China's renewed appeal due to lower stock valuations and new economic stimulus measures. In a bid to nudge the domestic economy and bail state governments, China recently approved a 10-trillion yuan (US $1.4 trillion) package. Per reports, approximately 60% of this stimulus focuses on allowing local governments to refinance the mountain of debt on them. Srivastava explains foreign investors are also flocking to US dollar and Treasury yields, which have appreciated significantly in the recent past, leading FPIs to anticipate a stronger US economy going ahead. Moreover, high valuations in Indian markets are discouraging foreign investors from putting more money in the economy. As a result, over the past week, the selling pressure eroded Rs 74,563 crore in market value for Reliance Industries, while Bharti Airtel and ICICI Bank lost Rs 26,274 crore and Rs 22,254 crore, respectively. The combined market valuation of six of the top 10 most-valued firms dipped by Rs 1,55,721.12 crore last week. <h2> Silver linings</h2>Despite the ongoing outflux of funds since last month, November also saw unprecedented applications of about 40–50 new FPI registrations, which are eyeing to enter the Indian market. This was due to markets SEBIs recent relaxation to NRIs, permitting them to participate up to 100% and announcing measures for ease of entry and operations in India. On the other hand, FPIs invested Rs 599 crore in the debt general limit and Rs 2,896 crore in the debt voluntary retention route (VRR) during the period under review. So far this year, FPIs have invested Rs 1.06 lakh crore in the debt market. <li class="whitespace-normal break-words"></li>Going ahead, investors will be looking for certain macroeconomic cues, which include corporate earnings reports, India's inflation (CPI) and industrial production (IIP) data on November 12, the US inflation report on November 13, and wholesale price index (WPI) data on November 14.

FPIs withdraw nearly Rs 20,000 crore from equities in the last 5 trading sessions, make a beeline for China and US

<ul class="summary-list"><li>Stock market valuations are near generational highs, Stifel's Barry Bannister says.</li><li>Bannister predicts the S&amp;P 500 could rise to the low-6,000s before plummeting back down.</li></ul>The stock market is "entering Crazy Town" as valuations creep toward generational highs, Stifel's chief equity strategist Barry Bannister said on Thursday.His comments come a day after the stock market soared to record highs <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/trump-election-win-stock-market-today-record-high-sp500-dow-2024-11">following Donald Trump's election win,</a> with the <a target="_blank" class="" href="https://markets.businessinsider.com/index/dow_jones">Dow Jones</a> surging more than 1,500 points and the <a target="_blank" class="" href="https://markets.businessinsider.com/index/nasdaq_100">Nasdaq</a> gaining nearly 3%.Bannister said current market valuations are pricing in an incredibly optimistic scenario that could lead to disappointment for investors."Even allowing for the best-case scenario of a U.S. soft landing, and despite a potential ramp higher for U.S. fiscal spending, as well as China global cyclical stimulus and lastly a geopolitical 'reckoning', the S&amp;P 500 is a mania, nearing a 3-generation valuation high," Bannister said.Bannister added that while he expects the <a target="_blank" class="" href="https://markets.businessinsider.com/index/s&amp;p_500">S&amp;P 500</a> to reach "the low-6,000s" in the short term, such a move higher would result in valuations hitting 80-year highs, as measured by the cyclically adjusted S&amp;P 500 CAPE earnings yield."The Earnings Yield (EPS/Price) is near the 3% low for the entire post-WW2 (since 1945) 3-generation period," Bannister said.According to Bannister, the extreme overvaluation suggests that even if the S&amp;P 500 continues to rise a few percentage points to the low 6,000s in the short term, it is ripe for a 1,000-point decline, or about 13%, within a year or so."If S&amp;P 500 tracks a century of manias it pops to low-6,000s in 4Q24 then round-trips to ~5,250 fair value" by early 2026, Bannister said.The S&amp;P 500 traded at 5,965 Thursday afternoon.Ultimately, Bannister believes that current stock market sentiment is nearing the point that typically marks the end of a bull expansion. Quoting the famed British investor Sir John Templeton, he added:"Bull markets are born on pessimism, grown on skepticism, mature on optimism, and die on euphoria."

The stock market is entering 'Crazy Town' as valuations reach generational high, Stifel says

New Delhi: <keyword id="19900795" type="General" weightage="20" keywordseo="foreign-investors" source="keywords">Foreign investors</keyword> pulled out a massive Rs 94,000 crore (around USD 11.2 billion) from the Indian <keyword id="19925636" type="General" weightage="20" keywordseo="stock-market" source="keywords">stock market</keyword> in October, making it the worst-ever month in terms of outflows, triggered by the elevated valuation of domestic equities and attractive valuations of <keyword id="20295104" type="General" weightage="20" keywordseo="Chinese-stocks" source="keywords">Chinese stocks</keyword>. Before this, foreign portfolio investors (FPIs) withdrew Rs 61,973 crore from equities in March 2020. The latest outflow came after a nine-month high investment of Rs 57,724 crore in September 2024. Since June, FPIs have consistently bought equities after withdrawing Rs 34,252 crore in April-May. Overall, FPIs have been net buyers in 2024, except for January, April and May, data with the depositories showed. Looking ahead, the trajectory of global events like geopolitical developments, interest rate movements, progress in the Chinese economy and the outcome of the US Presidential election will play a crucial role in shaping future foreign investment in <keyword id="20014814" type="General" weightage="20" keywordseo="Indian-equities" source="keywords">Indian equities</keyword>, Himanshu Srivastava, Associate Director, Manager Research, Morningstar Investment Research India, said. On the domestic front, key indicators like inflation trajectory, corporate earnings, and the impact of festive season demand will also be closely watched by FPIs as they assess opportunities in the Indian market, he added. According to the data, FPIs recorded a net outflow of Rs 94,017 crore in October. The intensity of net outflows could be gauged from the fact that except for one day, FPIs were net sellers throughout the month, bringing their total investment for 2024 down to Rs 6,593 crore. This relentless selling resulted in about an 8 per cent decline in benchmark indices from their peaks. Several factors contributed towards this massive withdrawal of foreign capital from the Indian equity markets in October. The major among them is the elevated valuations of Indian equities. This has triggered a shift in investments towards China, where valuations are currently more attractive. Additionally, a series of stimulus measures, aimed at bolstering Chinese economic growth has made Chinese equities increasingly appealing to global investors, Srivastava said. Despite the massive FPI selling in financials, this sector is resilient since the valuations are fair and every selling is being absorbed by DIIs and individual investors, particularly HNIs, VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said. In addition, FPIs pulled out Rs 4,406 crore from the debt general limit and invested Rs 100 crore from the debt Voluntary Retention Route (VRR) during the period under review. So far this year, FPIs invested Rs 1.06 lakh crore in the debt market.

FPIs withdraw record Rs 94,000 cr from Indian equities in Oct on attractive Chinese valuations

The stock of <keyword id="19896380" type="General" weightage="20" keywordseo="Reliance-Industries" source="keywords">Reliance Industries</keyword> Ltd climbed nearly 3 per cent during the late afternoon trade on Thursday following the announcement that the company's board will consider issuing 1:1 bonus shares on September 5. Shares of the firm jumped 2.63 per cent to Rs 3,074.80 on the BSE as soon as the announcement came in. At the NSE, the bellwether stock climbed 2.58 per cent to Rs 3,074. The company's market valuation also surged Rs 42,399.24 crore to Rs 20,60,461.42 crore. <keyword id="10926" type="General" weightage="20" keywordseo="Reliance" source="Orion">Reliance</keyword>, the nation's most valuable company, had last issued bonus shares in September 2017. "A meeting of the Board of Directors of the company is scheduled to be held on Thursday, September 5, 2024, to consider and recommend to the shareholders for their approval, issue of bonus shares in the ratio of 1:1 to the equity shareholders of the company by capitalisation of reserves," the firm said in the stock exchange filing. Prior to the 1:1 bonus issue in 2017, Reliance had in 2009 issued 1:1 bonus share.

Reliance Industries valuation jumps by Rs 42,399 crore following 1:1 bonus shares consideration announcement

Shares of <keyword id="19950203" type="General" weightage="100" keywordseo="TCS" source="keywords">TCS</keyword> on Friday climbed over 3 per cent after the country's largest <keyword id="20069374" type="General" weightage="20" keywordseo="IT-services" source="keywords">IT services</keyword> player reported 8.7 per cent growth in the June quarter net profit at Rs 12,040 crore. The stock went up by 3.10 per cent to Rs 4,044.35 on the BSE. At the NSE, it rallied 3 per cent to Rs 4,044.90. The company's <keyword id="20097096" type="General" weightage="20" keywordseo="market-valuation" source="keywords">market valuation</keyword> jumped Rs 40,359.77 crore to Rs 14,59,626.96 crore in morning deals. The stock emerged as the biggest gainer among the Sensex pack. "The positive domestic cue is the better-than-expected numbers from TCS and positive management commentary which can lift most IT stocks," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services. In the equity market, the 30-share BSE Sensex climbed 226.11 points to 80,123.45 in early trade. The <keyword id="19950205" type="General" weightage="20" keywordseo="nse-nifty" source="keywords">NSE Nifty</keyword> went up by 82.1 points to 24,398.05. <keyword id="19950119" type="General" weightage="20" keywordseo="Tata-Consultancy-Services" source="keywords" meta.keywordsubtype="org" meta.entityname="Tata Consultancy Services" meta.hostid="261" meta.entityid="Tata Consultancy Services">Tata Consultancy Services</keyword> (TCS) on Thursday posted an 8.7 per cent year-on-year rise in its consolidated net profit at Rs 12,040 crore for the first quarter ended June 2024. Net profit for the year-ago period stood at Rs 11,074 crore. The company - which competes in the IT services market with the likes of Infosys, Wipro and HCLTech - reported 5.4 per cent increase in revenue at Rs 62,613 crore for the quarter just ended. "I am pleased to report a strong start to the new fiscal year with all-round growth across industries and markets," K Krithivasan, Chief Executive Officer and Managing Director of TCS, said in a release. TCS has declared an interim dividend of Rs 10 per equity share of Re 1 each. Meanwhile, other IT stocks -- Infosys, Tech Mahindra, HCL Technologies and Wipro -- were also in demand.

TCS shares climb over 3% after earnings announcement; Market valuation jumps Rs 40,360 crore

<ul class="summary-list"><li>BlackRock's Rick Rieder says there are "no sellers" in the equity market.</li><li>Stocks will keep rising despite soaring market valuations, he told Yahoo Finance.</li></ul>Even with stock-market valuations hovering <a target="_blank" href="https://markets.businessinsider.com/news/stocks/stock-market-outlook-crazy-town-valuation-mania-sp500-barry-bannister-2024-11">near generational highs</a>, BlackRock's bond chief highlighted one key reason why stocks can continue higher."There's no sellers," Rick Rieder — the firm's global CIO of fixed income — said at a <a target="_blank" href="https://www.youtube.com/watch?v=Yjz_kTaO5pA">Yahoo Finance conference</a>.On the buying side, momentum is abundant, even as the prospect of persistently high interest rates boosts the appeal of the money-market funds."You think about the amount of money that comes into 401(k)s, wealth, salary — X percent goes into equities, and there's no sellers," he said.Rieder added that corporate buybacks are also backstopping stock market prices. Big companies have bought a trillion dollars worth of their own shares, he noted, shrinking the equity supply and pushing per-share values higher."So you shrink the denominator because they're buying back a bunch of their stock, and there's no sellers," Rieder said.He sees this more than offsetting any valuation pressures, even with one S&amp;P 500 adjusted-earnings ratio close to the highest it's been in the last century, according to new research from Deutsche Bank.And although Rieder sees current valuations as stretched, he added that market multiples could return to reasonable levels if earnings rise significantly higher."People want — myself included — want the multiple lower. But boy, it's pretty hard," he said. "If there's no egregious piece of news, geopolitical, et cetera, the natural migration is to higher prices."To be sure, Rieder himself has <a target="_blank" href="https://www.businessinsider.com/trump-us-debt-levels-government-borrowing-treasury-blackrock-rick-rieder-2024-11">previously noted impending risks</a>, previously forecasting that US debt could lead to a market shakeup. But this won't be an immediate threat."I think markets tend to react to the shark closest to the boat," Rieder said last week. "The shark on the debt dynamic is not going to be next to the boat in January or February, but it is going to get next to the boat sometime. I don't know if it's the latter part of 2025 or the beginning of 2026 unless they address the size of the spending dynamics, the amount of debt we're issuing, and, then obviously, inflation relative to that."

You Searched For "market valuations" and got 6 results

FPIs withdraw nearly Rs 20,000 crore from equities in the last 5 trading sessions, make a beeline for China and US

BI India Bureau

The stock market is entering 'Crazy Town' as valuations reach generational high, Stifel says

Matthew Fox

FPIs withdraw record Rs 94,000 cr from Indian equities in Oct on attractive Chinese valuations

PTI

Reliance Industries valuation jumps by Rs 42,399 crore following 1:1 bonus shares consideration announcement

PTI

TCS shares climb over 3% after earnings announcement; Market valuation jumps Rs 40,360 crore

PTI

BlackRock's bond chief explains why stocks will keep charging higher despite stretched valuations

Filip De Mott

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