Market Outlook: Anil Singhvi expects market to recover in full as FIIs likely to raise long positions

In a special edition of Editor’s Take, Zee Business Managing Editor Anil Singhvi said that he expects there will be an impact on Bank Nifty that is mostly positive amid the RBI Governor Shaktikanta Das’ address to the nation. In the last two days, the banking index is trying to take a lead role said the Market Guru. 

This strengthening of Bank Nifty will eventually help the Nifty to gain, says Singhvi, adding further, the market has completely loosened itself and there is a chance of recovery from here. 

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Explaining how the previous data helps to predict the future actions, Singhvi pointed out that when markets are normal, on average, 48-52 per cent of FIIs index long position is a 100 per cent indication that they have cut their short positions and increased long positions. 

Exactly same happened around a year ago in March-April 2020. FIIs log position was around 40-42 per cent, which was the lowest so far, and they increased their long positions by reducing the short. 

He adds, this data gives us confidence about what more could happen and how much more the markets would decline - if it really had to, then in the last couple of days it wouldn’t have touched the 15050 levels. 

FIIs selling at higher levels will dissuade the market a little and at a lower level because of FIIs short-covering, fresh buying, and strong global markets will act as a cushion to the market, said the Market Guru. 

The put-call ratio yesterday fell below 1, which was concerning, according to Singhvi, however, it has come to a comfortable position around 0.92 for the buying in the market. He adds, Nifty closing at 14500 levels has support, and recovery is expected in full.