Overseas investors have so far been net sellers of Indian equities, but there has been a change in sentiment recently, observes Tushar Mahajan, head of listed futures and options - India at Nomura.

So far this year, the rupee has weakened 7.2 percent, while foreign investors have sold $827.90 million and $6.23 billion in equity and debt markets, respectively.

“The mood on the FII (foreign institutional investor) side was bearish for a fairly large amount of time. We did see the net positioning on the open interest side being on the short side. This has started with the change of sentiment probably towards the later part of last week where first a lot of the short positions started getting covered and now finally we are seeing a build-up on the long side on the position," Mahajan told CNBC-TV18 on Wednesday.

"So this change of sentiment on the long side build up is probably coming in after over three months or so. That is where we saw for the first time the overall positioning change,” he said.

“Despite that, if you talk to people, there is still some kind of disbelief at this point in time that you know this is not sustainable and there is oil price, there is trade wars etc. But the way we look at it right now, the breakout is probably here to stay and the moment markets cross the psychologically important level of 11,000, which is just probably about 30-40 points on the Nifty then you will probably see a scramble for buying coming in again,” said Mahajan.

First Published:Jul 11, 2018 12:48 PM IST