Foreign investors extend selling streak, offload ₹1,468 crore
Foreign portfolio investors continued their selling momentum, offloading equities worth ₹1,468 crore on the session. The fresh round of exits added to the pressure on domestic markets, reinforcing a cautious tone among traders and fund managers.
What happened
Net foreign selling pushed flows out of equities, marking another day in a sequence of outflows. The scale of sales was large enough to weigh on sentiment, especially in mid- and small-cap segments where liquidity is thinner and moves can be more pronounced.
Why this matters
- Market sentiment: Continued FPI selling tends to make domestic investors more risk-averse, often leading to wider volatility and selective profit-taking.
- Liquidity impact: Large outflows reduce buying support, which can magnify downward pressure on prices even if fundamentals remain unchanged.
- Currency and rates: Sustained foreign exits can put downward pressure on the currency and influence monetary policy expectations, both of which affect equity valuations.
Possible reasons behind the selling
Reasons for the selling are often a mix of global and local factors: shifting risk appetite abroad, changes in interest rate expectations, profit-booking after recent gains, or reallocations within global portfolios. Short-term geopolitical or economic headlines can also trigger moves by international investors.
What investors should watch next
- Daily FPI flow updates to gauge whether selling continues or reverses.
- Domestic earnings and macro data that could attract or repel foreign capital.
- Global cues such as central bank statements and major economic releases that influence cross-border flows.
For now, the continued selling by foreign investors is a reminder that markets remain sensitive to flows. Investors may want to keep a balanced view — watching for opportunities while managing downside risk as liquidity dynamics play out.