FIIs offload almost ₹9,100cr in Indian equities this month
What's the story
Foreign institutional investors (FIIs) have maintained their selling spree in the Indian equity market this month as well.
As per market data, they have net sold ₹9,090 crore in the cash segment till February 7.
Despite pumping in ₹1,478 crore through primary market issuances, the overall 2025 trend remains heavily skewed toward selling with total outflows amounting to a staggering ₹90,993 crore.
Market dynamics
Strong Dollar and high US bond yields drive sell-off
The massive sell-off by FIIs can be largely attributed to the strength of the Dollar index and high US bond yields.
These factors have prompted FIIs to move capital away from emerging markets such as India.
"The strength in the dollar index and the high US bond yields continue to force the FIIs to sell," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Domestic outlook
Market sentiment improves despite FII sell-off
Despite the massive FII sell-off, domestic market sentiment is improving.
This positive change is attributed to a well-received Union Budget and a recent rate cut by the RBI.
"Going forward, FIIs are likely to reduce their selling since the dollar index and US bond yields are indicating a softening trend," Vijayakumar added.
Future prospects
Analysts optimistic about India's economic resilience
Despite global concerns like possible tariff and trade curbs from the newly elected US government, rising inflation risk, currency depreciation, and looming trade wars, analysts are optimistic about India's economic resilience.
"With sound and pathbreaking reforms for making the financial services sector more robust...the government has clearly laid the roadmap for 'Viksit Bharat' vision on track," said Manoj Purohit, Partner & Leader, FS Tax at BDO India.