Mumbai: Foreign institutional investors (FIIs) have now been net sellers in Indian equities for a 10th consecutive week, according to a report on 25 October, extending one of the longest recent stretches of overseas selling even as domestic institutions continue to absorb the supply.
Month-to-date, FII net selling stood at Rs 51,466 crore as of 24 October. The persistent outflow has been a central driver of the market’s recent softness, with overseas investors trimming exposure amid global uncertainty, elevated crude prices and a stronger dollar environment.
On the other side of the trade, domestic institutional investors (DIIs) have been net buyers for 10 straight weeks as well — a mirror image of the foreign trend. DIIs bought Rs 10,942 crore in the latest week alone, taking their month-to-date purchases to Rs 59,110 crore, a wall of domestic money that has cushioned the benchmarks from a far steeper fall.
The tug-of-war between foreign selling and domestic buying has defined Indian markets for months. Where earlier corrections might have run deeper, the steady inflow from mutual funds, insurers and pension money — much of it channelled through systematic investment plans — has repeatedly put a floor under prices.
Valuation watchers are also recalibrating. Bernstein has cut its Nifty target for December 2026 to 25,000 from 26,000, a downgrade that reflects the tougher global backdrop rather than any collapse in India’s earnings outlook. The revision is a reminder that even bullish houses are trimming expectations as the year-end approaches.
A crowded calendar of triggers lies ahead. Markets will watch the US Federal Reserve’s FOMC meeting, the Bank of Japan’s policy decision, US GDP data, the trajectory of crude oil and the remainder of India’s second-quarter earnings season — any one of which could tilt sentiment sharply in either direction.
For retail investors, the message of the past 10 weeks has been one of patience. The headline indices have corrected, mid-caps and small-caps more so, but the domestic bid has not wavered. Whether that bid can hold if foreign selling accelerates further is the question that will shape the next leg of the market.
The structural story, however, remains intact. Domestic participation in Indian equities is deeper than at any point in the market’s history, and the DII cushion is no longer a novelty but a feature. The foreign exodus has hurt, but it has not broken the market — and that, in itself, is a measure of how far India’s capital markets have come.
