Foreign investors continue sell-off, withdraw ₹34,800cr in October
What's the story
Amid rising economic fears, foreign portfolio investors (FPIs) withdrew ₹34,843 crore from Indian equities in October. This marks the second consecutive month of heavy outflows due to concerns over high crude oil prices, global interest rates, and corporate earnings outlook. The withdrawal follows significant investments made by FPIs in July and August.
Investment details
FPI investments in previous months
In July, FPIs invested ₹20,200 crore into Indian equities. This was followed by an even bigger investment of ₹29,631 crore in August.
However, the trend reversed in September when they withdrew a whopping ₹35,861 crore from the market.
The data from Central Depository Services Ltd (CDSL) highlights the recent volatility in FPI investments into Indian equities.
Outflow impact
Cumulative outflows in 2026 reach ₹2.95 lakh crore
With the latest withdrawals, cumulative FPI outflows from Indian equities in 2026 have reached a staggering ₹2.95 lakh crore.
The recent trend indicates a shift in near-term sentiment, but one week of buying does not necessarily indicate a sustained reversal, market experts said.
"For October as a whole, foreign selling remained significant," Anand K Rathi, co-founder of MIRA Money, said while commenting on the trends.
Market influence
Crude prices, US yields continue to influence capital allocation
Rathi also noted that higher crude prices pose risks to India's inflation and corporate margins.
He emphasized that attractive yields in the US continue to influence global capital allocation.
The sustainability of the recent improvement in foreign flows would depend on greater clarity on global macroeconomic conditions, crude prices, and the earnings outlook.
Market stability
Domestic institutional investors absorb foreign selling
Domestic institutional investors have played a crucial role in absorbing foreign selling and supporting market stability.
Despite the heavy withdrawals by FPIs, they were net buyers in three of the four trading sessions ending October 30. This indicates a possible improvement in their outlook toward Indian equities.
The recent trend has also helped Nifty reclaim the 23,000 level.