FIIs Continue Heavy Selling In Indian Markets, Stable Rupee & Better Earnings May Bring Investors Back
Foreign investors continue to pull money out of Indian stock markets due to weak earnings growth, high US bond yields and rupee weakness. Analysts believe improving corporate earnings and a stable rupee could help attract FIIs back, while domestic investors continue supporting the market through steady buying.
Foreign investors continue to pull money out of Indian stock markets due to weak earnings growth, high US bond yields and rupee weakness. |
Mumbai: Foreign Institutional Investors (FIIs) have remained net sellers in the Indian stock market this year.
According to market data, FIIs sold shares worth Rs 30,374 crore in May so far. Total FII selling in 2026 has now reached Rs 2.22 lakh crore.
This is much higher than the total selling of Rs 1.66 lakh crore recorded during the entire year of 2025.
What Is Driving The Selling?
Market experts say several global and domestic factors are behind the continuous outflow of foreign money from India.
ALSO READ
Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Investments, said weak earnings growth in India is one of the main reasons for the selling.
He added that some other countries are currently offering better growth opportunities and stronger company earnings.
High bond yields in the United States and the weakening rupee have also reduced the attraction of Indian equities for foreign investors.
Earnings Recovery Could Change Sentiment
Analysts believe foreign investors may return if company earnings improve and the rupee becomes stable.
Recent fourth-quarter earnings have shown early signs of recovery in corporate profits. This could slowly improve investor confidence in the coming months.
ALSO READ
Interestingly, while FIIs have been selling large-cap stocks, they are still investing in small and mid-cap companies where growth prospects remain strong.
DIIs Continue Supporting Markets
Domestic Institutional Investors (DIIs) have continued to support the market despite foreign selling.
During the last trading week, DIIs remained net buyers in all five sessions and invested Rs 16,950 crore in equities.
Rupee Weakness Linked To Equity Flows
Global brokerage Jefferies said the recent weakness in the rupee may not be mainly due to oil prices or India’s current account deficit.
ALSO READ
The brokerage noted that strong SIP inflows from domestic investors and heavy foreign selling in equities are putting pressure on the Indian currency.
Market Remains Volatile
Benchmark stock indices remained volatile last week as investors reacted to mixed global and domestic signals. Markets moved between gains and losses amid uncertainty across sectors.
RECENT STORIES
-
-
-
-
-