FPIs Extend Selling Streak in Indian Markets
Foreign portfolio investors continued their selling spree in Indian equities in January, pulling out nearly ₹11,800 crore so far this month. The sustained outflows have added to market volatility during the early part of the year, even as domestic investors provided some support.
Reasons Behind the Outflows
Market participants attribute the continued selling to global uncertainties, including concerns over economic growth, geopolitical tensions, and shifting risk appetite. A strong US dollar and expectations around global interest rate movements have also made emerging markets like India less attractive to some foreign investors in the short term.
Impact on Indian Markets
The persistent FPI selling has weighed on benchmark indices, though the broader market has avoided sharp corrections due to steady buying by domestic institutional investors. Analysts note that India’s economic fundamentals remain relatively strong, but global cues are currently driving foreign investment decisions.
Outlook Ahead
Experts believe FPI flows could stabilise once there is greater clarity on global monetary policy and macroeconomic conditions. Until then, markets may continue to see intermittent volatility linked to foreign fund movements.
