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Foreign investors continued to pare their vulnerability to Indian equities, withdrawing ₹14,231 crore truthful acold this period driven by persistent planetary macroeconomic uncertainties.
With this, the full outflow of Foreign Portfolio Investors (FPIs) from the equity marketplace has crossed ₹2 lakh crore successful 2026, which is higher than the ₹1.66 lakh crore pulled retired during the full 2025, according to information with the NSDL.
FPIs were nett sellers successful each months of 2026, but February. They withdrew ₹35,962 crore successful January earlier turning nett buyers successful February, erstwhile they invested ₹22,615 crore, the highest monthly inflow successful 17 months.
However, the inclination reversed successful March, erstwhile overseas investors pulled retired a grounds ₹1.17 lakh crore. The selling continued successful April with nett outflow of ₹60,847 crore and extended into May with withdrawal of ₹14,231 crore truthful far.
"The selling was mostly driven by persistent planetary macroeconomic uncertainties, peculiarly concerns astir inflation, involvement rates and geopolitical risks, which continued to measurement connected sentiment toward emerging markets," said Himanshu Srivastava, Principal - Manager Research astatine Morningstar Investment Research India.
He said uncertainty implicit the planetary involvement complaint trajectory remained a cardinal origin influencing flows. Elevated crude lipid prices and lingering geopolitical tensions, particularly successful West Asia, kept ostentation concerns live globally, prompting investors to reassess expectations of near-term complaint cuts by large cardinal banks.
As a result, planetary enslaved yields remained comparatively firm, enhancing the attractiveness of developed-market fixed income assets and reducing hazard appetite for emerging marketplace equities, helium added.
Mr. Srivastava besides noted that the Indian rupee remained nether intermittent pressure, impacting dollar-adjusted returns for overseas investors.
V.K. Vijayakumar, Chief Investment Strategist astatine Geojit Investments, said that contempt the wide selling, FPIs had been selectively investing successful sectors specified arsenic power, operation and superior goods.
Another large inclination was their expanding penchant for mid-cap and prime small-cap stocks with beardown maturation imaginable and steadfast net performance, helium said.
According to Mr. Vijayakumar, currency depreciation and concerns implicit net maturation successful India had been cardinal factors driving FPI outflows this year.
He added that stronger net maturation expected successful markets specified arsenic South Korea and Taiwan, supported by the artificial quality boom, was attracting FPI flows to these markets.
