On Wednesday, foreign portfolio investors (FPIs) made a significant comeback in the Indian equity market, purchasing shares worth an impressive Rs 931.80 crore. This marked a shift from their previous selling spree, highlighting renewed confidence among overseas investors. Meanwhile, domestic institutional investors continued their buying trend, acquiring equities valued at Rs 316.3 crore, as reported by provisional data from the National Stock Exchange (NSE).
FPI Activity in May
In an encouraging trend, FPIs have been net buyers in May, amassing shares totaling Rs 11,943 crore thus far. This resurgence follows a prior month in which they purchased equities worth Rs 4,223 crore, according to the National Securities Depository Ltd. (NSDL). It’s noteworthy that FPIs had been net sellers during the first quarter of 2025, offloading equities worth over Rs 1 lakh crore in total.
- March: Net selling of Rs 3,973 crore
- February: A stark net sell of Rs 34,574 crore
- January: A significant decline with net sales of Rs 78,027 crore
Market Performance
The Indian stock market reacted positively to these developments, with both benchmark indices closing higher on Wednesday. The Nifty 50 rose by 0.36%, finishing at 24,666.90, while the Sensex closed up by 0.22% at 81,330.56. This rebound followed a minor setback the previous day when both indices recorded losses after a remarkable 4% surge on Monday.
This previous rise can be attributed to easing geopolitical tensions between India and Pakistan, alongside optimistic signals emerging from ongoing US-China trade negotiations. Such dynamics have played a crucial role in shaping investor sentiment.
Looking Ahead
As we move forward in May, the trend of foreign investments will be crucial for assessing the overall health of the Indian stock market. Investors are keenly watching how FPIs will respond to both domestic developments and global economic indicators.
In summary, the shift in FPI behavior coupled with domestic buying suggests a potential stabilization in the market, bringing renewed optimism to investors after a challenging start to the year. Keep an eye on upcoming trading sessions to see if this momentum continues.
