Archive · 5 Oct 2026
IT and Metal Stocks in Focus as FIIs Build Shorts
Foreign institutional investors have added both long and short bets on index futures, but they added more shorts.
This has made their overall positioning cautious.
The article looks at two stock-market sectors: metals and information technology.
Metal shares show several signs that prices could keep falling, although the index is near levels that may provide support.
If it falls below an important support level, it could drop further.
IT shares are showing early signs of a possible bounce.
But the recovery is not confirmed, and the index must get past a key resistance level.
If it falls below support instead, the decline could continue.
Foreign institutional investors increased index-futures longs by 6% and shorts by 15% over the week, leaving the long-short ratio at 8.
After expiry, FII index-futures longs were liquidated by 42.5%, compared with an 8.4% reduction in shorts.
The Nifty Metal Index is testing its 200-day moving average, but bearish signals leave downside risks open.
Metal index support is cited at 12,260 and 12,060; a sustained break below 12,060 could expose the 10,600 region.
The Nifty IT Index is attempting a recovery, with resistance at 29,190 and key support at 27,590.
- Who
- Foreign institutional investors and traders in the Nifty Metal and Nifty IT indices.
- What
- FIIs built index-futures positions, while the article assessed possible moves in metal and IT stocks.
- When
- In the week discussed, including trading on Friday and activity after expiry; the watchlist is for Monday.
- Where
- Indian markets, particularly the Nifty Metal Index and Nifty IT Index.
- Why
- The article examines futures positioning and technical indicators for signs of possible sector rebounds or further declines.
Potential Recovery
Downside Risks
Nifty Metal outlook
Potential Recovery
Stabilisation around the 200-day moving average and support near 12,260 or 12,060 could allow a brief relief rally.
Downside Risks
The index has a bearish chart pattern and weak momentum; a sustained break below 12,060 could expose the 10,600 region.
Nifty IT outlook
Potential Recovery
A reversal candle, improving momentum, derivatives positioning, and long build-ups in most IT stock futures point to a possible near-term rebound.
Downside Risks
The recovery remains tentative; resistance at 29,190 may limit gains, while a break below 27,590 could send the index toward 25,900.
- FII index-futures longs
- Rose 6% to 29,605 contracts by the end of the week.
- FII index-futures shorts
- Rose 15% to 3,39,779 contracts by the end of the week.
- FII long-short ratio
- Fell to 8, described as close to record lows.
- Nifty Metal support
- 12,260, followed by 12,060.
- Nifty Metal downside risk
- A sustained break below 12,060 could open a path toward 10,600.
- Nifty IT resistance
- 29,190, near the 100-day moving average.
- Nifty IT support
- 27,590; a sustained break could accelerate a decline toward 25,900.
- Article author
- Anand James, Chief Market Strategist at Geojit Investments.