Global funds sell net 91.1 bln rupees of India equities prior trading day: NSDL

Global funds sell net 91.1 bln rupees of India equities prior trading day: NSDL

Global funds recorded a net outflow of ₹24.3 billion ($298 million) from Indian equities on the prior trading day, according to NSDL data. This marks a reversal from earlier inflows in February 2026, including a ₹19,675 crore ($2.43 billion) purchase in mid-February, underscoring the sector's sensitivity to macroeconomic shifts. The recent outflow aligns with broader global capital flow uncertainties, including currency fluctuations and geopolitical risks, which have historically influenced foreign investor behavior.

Foreign institutional investors (FIIs) remain critical to India's equity market dynamics. In 2025, FIIs sold ₹1.5 trillion in Indian stocks—the largest annual outflow in recent history—due to stretched valuations and a weak rupee. However, the India-U.S. trade deal in February 2026 temporarily restored confidence, triggering a two-week inflow of ₹19,675 crore. The recent reversal suggests fragility in these gains.

Domestic institutional investors (DIIs) have increasingly offset FII volatility, now owning 24.8% of Nifty 50 stocks compared to FIIs' 24.3%. This trend, driven by sustained systematic investment plan (SIP) inflows, provides stability during foreign outflows. Meanwhile, Bloomberg data indicates that global funds added $2.1 billion to Indian equities in February through Feb. 24, surpassing domestic institutional purchases for the first time in 17 months.

While short-term volatility persists, long-term fundamentals—such as India's fiscal reforms and corporate governance improvements—remain intact. Investors are advised to monitor upcoming earnings and global policy developments for clarity on the market's trajectory.