DIIs gain sway in market movement, rating agencies review firms, and more

DIIs gain sway in market movement 

Domestic institutional investors (DIIs) are increasingly holding a greater sway in dictating market movement. DII holding in the BSE500 universe stood at a record high of 14.4 per cent at the end of the September quarter, according to a note by Credit Suisse. The brokerage says that at 1 per cent of market capitalisation, the flows are still small in absolute terms, but the share of domestic mutual funds in overall trading has risen to 13-15 per cent compared to a single-digit share five years back. Consequently, the gap between the share of trading volumes of foreign portfolio investors and domestic mutual funds has narrowed substantially.   
 
Grey market frenzy for SBI Cards
 
Grey market activity for SBI Cards has started even before the announcement of its issue price. Grey market operators are offering a premium of Rs 230 per share for SBI Cards. Usually, grey market activity starts once the issue price is announced. However, of late, the trend of quoting grey market premium before the issue price announcement is catching up. According to brokers, this is the new trick of grey market operators to lure gullible investors and the trend started with the issue of CSB Bank.
 
 
Ratings check
 
Rating agencies reviewing companies have started reaching out to statutory auditors when looking through a firm's financial statements before deciding on a rating. The idea is to get a better sense of the numbers and avoid nasty surprises, according to a source. Such instances were rare earlier but have increased in recent times. A number of instances where auditors had resigned abruptly had caused investors to dump shares in a hurry. Shareholders, it seems, aren't the only ones afraid of being caught on the wrong foot.