Foreign Portfolio Investors have continued their robust buying trend in Indian equities, injecting Rs 12,921 crore in the first week of August, buoyed by improving macroeconomic conditions and expectations of US rate cuts.
Key Points
- Foreign Portfolio Investors (FPIs) invested Rs 12,921 crore in Indian equities during the first week of August, continuing a positive trend.
- This inflow follows a significant Rs 20,200-crore investment in July, marking a turnaround after four months of heavy selling.
- Key drivers for the sustained buying include improving macroeconomic conditions, anticipated US rate cuts, stable rupee, and lower crude oil prices.
- FPIs have shown a preference for sectors like automobiles, consumer durables, and healthcare.
- Foreign investor interest also extended to the debt market, with an inflow of Rs 622 crore during the same period.
Foreign Portfolio Investors (FPIs) maintained their buying spree in Indian equities, investing Rs 12,921 crore in the first week of August, driven by improving macroeconomic conditions, expectations of US rate cuts, lower crude oil prices and a stable rupee.
The inflow follows a Rs 20,200-crore investment in July, marking a sharp turnaround after four consecutive months of heavy selling.
FPI Activity and Market Sentiment
FPIs had withdrawn Rs 49,340 crore in June, Rs 32,963 crore in May, Rs 60,847 crore in April and a massive Rs 1.17 lakh crore in March.
Prior to this selling streak, they had invested Rs 22,615 crore in February, according to CDSL data.
Despite the recent buying, foreign investors have remained net sellers in Indian equities in 2026, withdrawing Rs 2.41 lakh crore so far, already exceeding the Rs 1.66 lakh crore outflow recorded during the entire 2025.
Drivers of Recent Inflows
Market experts said the recent inflows reflect improving investor sentiment, supported by expectations of US rate cuts, softer crude prices and a stable rupee.
The RBI's improved growth and inflation outlook has further strengthened confidence, while relatively low foreign ownership of Indian equities leaves room for fresh allocations, said Vedant Gupte, Co-Founder and CEO of investment platform Trackk.
Importantly, a large share of the recent buying has come through the secondary market, signalling stronger interest in listed Indian companies rather than merely IPO allocations, Gupte added.
Sectoral Preferences and Debt Market Interest
"The sustained buying by both FIIs and DIIs was largely driven by the de-escalation of geopolitical tensions, which helped strengthen investor confidence and supported positive market sentiment," said Pabitro Mukherjee, Deputy Vice President-Research, Bajaj Broking.
V K Vijayakumar, Chief Investment Strategist at Geojit Investments, said an important trend in FPI buying is their preference for sectors such as automobiles, consumer durables and healthcare.
Foreign investor interest has also extended to the debt market, which continued to attract inflows. FPIs invested Rs 622 crore in debt through the general route during the period under review.
