Market weekly update: FPIs resume selling after a brief pause in Oct; withdraw ₹12,569 crore in Nov

After a brief pause in October, foreign portfolio investors have resumed selling, pulling out a net ₹12,569 crore from Indian equities so far in November amid weak global cues and risk-off sentiment.

This follows a net inflow of ₹14,610 crore in October, which had come after consecutive months of outflows—₹23,885 crore in September, ₹34,990 crore in August, and ₹17,700 crore in July, according to data from depositories.

The renewed selling trend, which has continued on every trading day of November so far, has contributed to India's underperformance compared with other major markets this year, said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

He noted that a key feature of FPI activity in 2025 has been the divergence in flows, with hedge funds selling in India while buying in markets perceived as beneficiaries of the AI-driven rally, such as the US, China, South Korea, and Taiwan.

"India is currently being viewed as an AI-underperformer, and that perception is shaping FPI strategy," he explained.

However, Vijayakumar added that AI-linked valuations are now stretched, and the risk of a potential bubble in global tech stocks could limit sustained selling in India.

"If this realisation strengthens and India's earnings growth continues to improve, FPIs may gradually turn buyers again," he said.

Echoing a similar view, Vaqarjaved Khan, Senior Fundamental Analyst at Angel One, said FPIs sold Indian equities worth ₹12,569 crore in the first week of November amid a global sell-off in technology stocks across Asia and other major markets.

India Inc's Q2 FY26 results have been marginally better than expected, especially in the midcap segment, but global headwinds may keep foreign investors cautious toward riskier assets in the near term.

"Flows could turn positive in select sectors and stocks as the earnings season progresses," Khan said.

So far in 2025, FPIs have withdrawn over ₹1.5 lakh crore.

Meanwhile, in the debt market, FPIs withdrew ₹1,758 crore under the general limit while investing ₹1,416 crore through the voluntary retention route during the period under review.

Stock market last week

On Friday, the Indian stock market ended almost flat down after trimming most of its losses amid weak global cues and continued foreign fund outflows. A late rebound, driven by gains in financial and metal stocks, helped limit the downside.

At close, the 50-share index NIFTY50 closed at the 25,492.30 level, falling 17.40 points, or 0.07%, while the S&P BSE SENSEX settled 94.73 points, or 0.11%, lower at the 83,216.28 level.

With Friday’s close, the benchmark indices extended their losses for the second straight week, with both the Sensex and Nifty50 declining 0.9%, while the Nifty Bank inched up 0.12%. Broader markets also remained subdued, as the Nifty Midcap 100 ended flat and the Nifty Smallcap 100 slipped 1.7%.