FPIs Turn Net Buyers In Indian Markets
Foreign Portfolio Investors (FPIs) turned net buyers in the Indian stock market in February, marking a notable shift after months of outflows, with inflows reaching their highest level in over a year. Despite this return of foreign capital, broader market sentiment remained cautious amid persistent volatility.
FPIs Turn Net Buyers In February
Data from market depositary figures show that FPIs net invested about ₹22,615 crore in Indian equities in February, the largest monthly inflow observed in 16 months. This marked a reversal of a three-month streak of net selling that had seen foreign investors pull capital out of Indian stocks in late 2025 and early 2026. The inflows reflect renewed interest from overseas investors in Indian markets, particularly in certain key sectors.
Sectoral Trends And Investment Drivers
While FPIs were net buyers overall, there was significant sectoral divergence in their investment patterns. Foreign investors continued to reduce exposure in some segments, notably information technology stocks, even as they added positions in financial services, capital goods and other domestic economy-linked sectors. Analysts attribute the renewed interest partly to improving corporate earnings momentum, especially strong results for the third quarter of the fiscal year.
However, market participants also noted that inflows came amid fragile investor sentiment, shaped by global geopolitical tensions and concerns over volatility in key sectors. This combination has made some investors adopt a selective approach, favouring companies with robust fundamentals.
Market Performance And Outlook
Despite the return of foreign inflows, major Indian benchmark indices, including the BSE Sensex and the NSE Nifty 50, ended February slightly lower, reflecting continued market caution. The mixed performance suggests that while FPIs are showing renewed interest, overall confidence remains tempered by global economic and geopolitical uncertainties.
