Foreigner Portfolio investors (FPIs) were net sellers in September after two consecutive months of buying. He withdrew money from the domestic stock market in September by selling shares worth a total of Rs 35,860 crore. According to Central Depository Services Limited (CDSL) data, selling by foreign investors continued in October and they sold Rs 9232 crore from the market on October 1 also.
Selling by foreign investors crossed Rs 2.7 lakh crore this year
Let us tell you that before this, foreign investors had invested Rs 20,200 crore in the Indian stock market in July and Rs 29,630 crore in August. With the latest selloff in September, FPIs have so far withdrawn approximately Rs 2.7 lakh crore from the Indian stock market in 2026 by selling shares. This is much more than the withdrawal of Rs 1.66 lakh crore made in the entire 2025.
Why did FPIs lose their fascination with the domestic stock market?
Rajesh Singla, funds manager and CEO, Alpha AMC, said FPIs are pulling money out of Indian stocks mainly due to external factors. These include higher crude oil prices amid supply concerns related to the Strait of Hormuz, rupee depreciation, profit booking after investments in July-August and capital movement towards AI-driven North Asian markets.
Investment is coming continuously through SIP
Rajesh Singla said, “This is a matter of allocation of capital at the global level, not the earnings of domestic companies.” Singla said that continuous investment through domestic SIP is helping in reducing the impact of foreign selling. He said that due to the relatively low stake of foreign investors in the small and medium enterprises (SME) and small stocks segments, these segments have been comparatively less affected by the foreign selloff.
Now on what issues will the mood of FPIs depend on?
According to experts, the future strategy of FPIs will depend on the Iran-US conflict and its impact on crude oil prices. He said higher crude oil prices and higher yields on US bonds could put pressure on Indian stocks and FPI investments. America’s 10-year bond yield is around 5 percent. However, experts said the strong performance of the Indian economy and expectations of strong growth in corporate earnings are positive factors.
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