The markets have reacted on FII selling in cash and F&O on Monday, April 11.The Sensex declined today by almost 150 points from the high of 11,703 to the current level of 11,550. The S&P CNX Nifty reacted by over 50 points from high of 3484 to the current level of 3432. Selling pressure came as FIIs are reported to be net sellers to the tune of Rs 2,000 crore in F&O. The FIIs have been net sellers worth Rs 900 crore in index futures and around Rs 1,100 crore in stocks futures. In the last four trading days, FIIs have been net seller in F&O to the tune of Rs 4,500 crore.FIIs, which have been selling in the Indian market in the past four days, have created the same condition that the market faced on March 8, 2006. Last time, they were short in Nifty, and had to pay a huge penalty in terms of loss of Rs 300-400 crore. The Nifty had rallied by over 300 points from 3116 on March 8 to 3419 on March 30 - the last day of the expiry of March contract.This time again they are short in the stocks futures and trying to make-up for the losses. Despite being net sellers at Rs 1,190 crore on April 7, Rs 824 crore on April 5 and Rs 556 crore on April 4, the Nifty has been steady at around 3480 during the first week of April. Today, after the news was released of FII selling, the Sensex rallied from the day's low by 100 points and again fell by over 100 points. On March 8, the Sensex had declined by over 200 points and the Nifty by over 54 points.The market players now believe that the Sensex and Nifty would recover as it had done in March. The reasons being cited are Infosys bonus, on-going public offer of Reliance Petroleum, likely strong results from FMCG giant Hindustan Lever, overseas acquisition by Tata Steel, encouraging growth number by Tata Motors, Bajaj Auto's recent expansion for exports and highest cement despatch numbers so far.
