Iran-Israel war or election jitters? Why FIIs decamped with Rs 20,000 crore in 4 days
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Foreign institutional investors (FIIs) withdrew Rs 20,000 crore in just 4 trading sessions amid rising bond yields, Iran-Israel war, and India-Mauritius tax tweak. The stress points for FIIs are the rising bond yields and a tweak in the India-Mauritius tax treaty. The Nifty has lost about 3.5% of its value in the last 5 days. Market expert Ajay Bagga predicts another 2-3% cut is possible. The main risk to India and other oil importers is the oil price. Brent crude oil prices have rallied around 14% so far in the calendar year and were last trading around the $88 a barrel mark. The US Treasury yields remain around the critical 4.55% mark. The yield on the benchmark 10-year bond in India had hit 7.2274%, the highest level since January 8. US Fed policymakers now agree that there is no rush to cut interest rates following strong growth in jobs and robust retail spending. Wall Street has begun to price in fewer and delayed rate cuts. Another issue haunting investors is the inking of a protocol to tweak a treaty to impose higher scrutiny on investments made in India via Mauritius. The impact of the amendment may be limited as the share of Mauritius funds in the total FPI equity assets under management is less than 6%.

#Fiis #BondYields #IranisraelWar #IndiamauritiusTaxTreaty #Nifty #OilPrices #UsTreasuryYields #UsFedRateCuts #MauritiusFunds

https://m.economictimes.com/markets/stocks/news/iran-israel-war-or-election-jitters-why-fiis-decamped-with-rs-20000-crore-in-4-days/articleshow/109427769.cms