Expect FII inflows to be strong in coming days: U R Bhat, Dalton Capital Advisors

In a chat with ET Now, U R Bhat, MD, Dalton Capital Advisors, shares his views on FII inflows and current market outlook. Excerpts:

ET Now: Nifty is close to achieve an all-time high. Cyclical stocks have made a come back and Indian equity is globally strong. Do you think in short term Indian market will go higher?

UR Bhat: There is a huge disconnect between what is happening in the market and what has happened in macro economy in India. The only thing that is driving the market is FII inflows; they continue to be strong in September and in October till now.

Hence, as long as that continues, the macro economy will not matter all that but these things will come back to haunt us—the state of the macro economy, the state of interest rates, the twin deficit.

Currently, FII continues to be attracted to India partly because there is a delay in the taper; the debt ceiling has also been temporarily postponed till-January.