New Delhi [India]: Foreign Portfolio Investors (FPIs) remained net sellers in Indian stock markets for the third straight month in March, extending their selling streak throughout 2025.
FPI Outflows in 2025 So Far
According to National Securities Depository Limited (NSDL) data:
- FPIs sold stocks worth ₹3,973 crore in March.
- In January, FPIs offloaded ₹78,027 crore worth of equities.
- In February, they sold stocks worth ₹34,574 crore.
This persistent selling pressure has weighed on the Indian markets, contributing to a significant decline from record highs. The Sensex currently trades 8,500 points below its all-time high of 85,978 points.
Market Trends and Factors Influencing FPI Movements
The pace of FPI sell-offs slowed towards the end of March, with some signs of modest buying interest emerging.
VK Vijayakumar, Chief Investment Strategist at Geojit Investments, noted:
“The change in FII strategy from sustained selling to modest buying, visible in the week ending March 21st, continued with increased intensity for the week ending March 28th. Big buying by FIIs during the last several days of March substantially reduced the total FII selling in March.”
Despite this shift, uncertainties continue to weigh on the market. Global volatility remains high, fueled by concerns over potential US tariffs and their impact on trade relations, particularly with India.
US Tariffs and Investor Sentiment
Since assuming office for his second term, US President Donald Trump has reaffirmed his tariff reciprocity stance, vowing to match tariffs imposed by other nations, including India. This policy has created uncertainty among global investors and contributed to increased volatility in Indian markets.
Performance of Indian Stock Market in Recent Years
- In 2024, Sensex and Nifty posted gains of 9-10%.
- In 2023, they gained 16-17%.
- In 2022, the growth was a modest 3%.
A comfortable inflation rate in February provided some relief, helping the Indian equity indices hold firm despite concerns over external factors.
Outlook for Indian Markets
While FPI selling pressure remains a concern, analysts believe that strong domestic fundamentals and easing inflation could provide support to Indian equities in the coming months. However, geopolitical uncertainties and global economic policies will continue to play a crucial role in determining market movements.