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Investor interest in delivery-based trades has touched a near four-year low signalling loss of investor confidence in the markets. According to data sourced by Business Standard, the average delivery volumes have declined significantly in the last few months as markets turned volatile.
Market analysts said that the erratic movement in the stock market brought on by weakening economic conditions and the recent decline in rupee have made investors jittery about market performance.
"Investors are a bit cautious as the stock price movements are highly volatile. Any negative news, whether big or small, leads to heavy price declines of about 20-30%, particularly in small and mid-cap stocks," said Alex Mathew, head of research at Geojit BNP Paribas Financial Services.
According to data from the exchanges, the daily average delivery-based trades have halved to about 300 million shares as on July 2013. Delivery-based trades are indicators of investor confidence in the market and the stock performance.
Since January this year, average daily delivery volumes are down by 32%. On the BSE, the average daily volumes have fallen by over 43%, while on the NSE they have declined by about 27%.
