FPIs Turn Net Sellers in Indian Equities: ₹11,265 Crore Pulled Out Between July 14–18
By Shishta Dutta | Updated at: Jan 9, 2026 01:49 PM IST
Mumbai, July 21, 2025: Foreign Portfolio Investors (FPIs) adopted a distinctly bearish stance in Indian equities during the trading week of 14 to 18 July, withdrawing a net ₹11,265.46 crore. This significant outflow was attributed to a global risk-off sentiment, rising US bond yields, and cautious cues from central banks. This marks the sharpest weekly net outflow in the current financial year (FY26) so far, indicating waning appetite for emerging markets amidst global volatility.
Sharpest Weekly Equity Outflow in FY26 So Far
Across the five-day span, FPIs were net equity sellers every single day. The selling peaked mid-week on July 18, with equities witnessing a net outflow of ₹2,864.12 crore.
| Date | Gross Equity Buys (₹ Cr) | Gross Equity Sales (₹ Cr) | Net Equity Investment (₹ Cr) |
|---|---|---|---|
| July 14 (Mon) | 12,859.09 | 17,354.10 | -4,495.01 |
| July 15 (Tue) | 18,434.26 | 19,223.58 | -789.32 |
| July 16 (Wed) | 12,485.56 | 12,659.19 | -173.63 |
| July 17 (Thu) | 12,039.57 | 13,080.16 | -1,040.59 |
| July 18 (Fri) | 12,506.81 | 15,370.93 | -2,864.12 |
| Total | 68,325.29 | 77,687.96 | -11,265.46 |
FPIs were net equity sellers every day during this five-day period, with the selling pressure peaking on 18 July. This substantial pullback suggests that global factors and risk aversion are currently dominating foreign investment decisions concerning Indian equities.
Debt Market Activity: FAR Remains FPI Favourite
Despite the sell-off in equities, foreign investors maintained their interest in India’s long-term sovereign debt through the Fully Accessible Route (FAR). The FAR route, introduced by the RBI, allows foreign investors unrestricted access to specified Indian government securities without any investment caps. This route saw a notable net inflow of ₹3,248.40 crore over the week, indicating continued confidence in India’s macroeconomic fundamentals and the attractiveness of its sovereign bond yields.
| Date | Debt-FAR Net Investment (₹ Cr) |
|---|---|
| July 14 | 34.35 |
| July 15 | 1,802.01 |
| July 16 | 1,274.15 |
| July 17 | -342.70 |
| July 18 | -184.42 |
| Total | 3,248.40 |
Conversely, the Debt-VRR (Voluntary Retention Route), a separate channel designed to encourage long-term FPI investments in Indian debt markets by offering greater operational flexibility, recorded net outflows for four out of five days, with a cumulative weekly outflow of ₹431.87 crore. This suggests continued caution in corporate and quasi-sovereign bonds within this specific route.
Derivatives Snapshot: High Volatility Drives Turnover
FPI activity in the derivatives segment remained aggressive, indicative of hedging strategies amidst increased market volatility. Friday, 18 July, recorded the highest weekly notional turnover in this segment.
| Segment | Net Investment on July 18 (₹ Cr) |
|---|---|
| Index Futures | -1,992.50 |
| Stock Futures | -1,488.48 |
| Index Options | Net seller, large volume |
| Stock Options | Net seller, high activity |
Index futures contracts touched 20,309 on 18 July, nearly double the buy side, highlighting aggressive hedging.
Mutual Funds: Domestic Stability Amid Global Turbulence
In a counter-trend to FPI behaviour, Indian mutual funds remained net investors throughout the week in equity schemes, helping to absorb some of the foreign selling pressure. The largest net inflow into equity mutual funds was ₹15.55 crore on 17 July. Debt schemes also recorded modest inflows on some days, though hybrid funds saw mixed participation.
| Date | Equity MF Net Inflow (₹ Cr) |
|---|---|
| July 14 | 0.37 |
| July 15 | 3.07 |
| July 16 | 1.41 |
| July 17 | 15.55 |
| July 18 | 4.15 |
| Total | 24.55 |
This consistent buying by Domestic Institutional Investors (DIIs) through mutual funds has been a crucial support factor for the Indian market, particularly as FPIs have been net sellers in the secondary market for the entire month of July, with total outflows reaching ₹10,775 crore by 18 July.
Outlook: Risk-Off Sentiment May Persist
With the US dollar strengthening and bond yields rising globally, foreign investors may continue to be wary of emerging market risk assets. However, the sustained participation in long-term government debt via the FAR route signals a degree of underlying confidence in India’s macro fundamentals and the attractiveness of its bond yields. Any significant shift in US Federal Reserve commentary or domestic policy developments could influence the next phase of FPI action in the Indian market.
About FPI Monitor
FPI data is compiled daily by NSDL using submissions from registered custodians, depositories, and major exchanges, including NSE, BSE, and MCX. This data reflects provisional and confirmed investment flows across various asset classes such as equity, debt (General, VRR, FAR), hybrid instruments, mutual funds, and Alternative Investment Funds (AIFs).
REF: https://www.fpi.nsdl.co.in/web/Reports/Monthly.aspx
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