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Three Weeks of Buying—Then This: What Spooked the Foreign Money?


Updated: July 23, 2025 09:00

Image Source : NewsBytes
1. Reversal After a Three-Month Buying Streak
 
Foreign portfolio investors (FPIs) have turned net sellers in Indian equities this July, ending a steady inflow trend seen since April.
 
- Between July 1 and July 18, FPIs offloaded Rs 10,775 crore from the secondary market
 
- Most of the selling—Rs 10,219 crore—occurred in just five sessions between July 14 and 18
 
- This marks a sharp pivot from June’s Rs 14,590 crore inflow
 
2. Mixed Signals: Primary Market Still Attractive
 
Despite the exit from secondary markets, FPIs remain active in IPOs and QIPs.
 
- Rs 5,251 crore invested in the primary market during the same period
 
- Analysts suggest FPIs are chasing fairer valuations in new issuances
 
3. What’s Driving the Pullback?
 
Multiple factors are contributing to the cautious sentiment:
 
- Elevated stock valuations and underperformance relative to other emerging markets
 
- Uncertainty around US-India trade negotiations and tariff deadlines
 
- Mixed corporate earnings, especially in financial and IT sectors
 
- Global cues and stronger US assets prompting profit booking
 
4. Domestic Investors Hold the Fort
 
While FPIs retreat, domestic institutional investors (DIIs) continue to support the market.
 
- DIIs have been net buyers for 24 consecutive months
 
- In July alone, DIIs pumped in Rs 21,893 crore—more than double the FPI outflows
 
Sources: Outlook Money, Economic Times, ABP Live, Goodreturns, Outlook Business, The Hans India, MSN India

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