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Foreign investors extend buying streak for a second month in India
Foreign portfolio investors bought a net ₹30,919 crore of Indian equities in August after ₹20,200 crore in July, reversing four months of heavy outflows.
Foreign portfolio investors turned net buyers for a second straight month, purchasing ₹30,919 crore of Indian equities in August, extending a buying streak that follows one of the worst stretches for foreign flows in years, according to LiveMint Markets. That August inflow came after ₹20,200 crore of buying in July, and it marks a sharp reversal after four consecutive months of heavy offloading.
CDSL data cited by LiveMint Markets shows overseas funds withdrew heavily earlier in the year, including a massive ₹1.17 lakh crore outflow in March. The latest consecutive months of buying offer early signs of a trend reversal, as corporate earnings and a more stable currency improved the market’s appeal.
The drivers of the shift include a reversal in chip trade flows, stability in the rupee, and improving earnings growth in India, Geojit Investments strategist V K Vijayakumar said. LiveMint Markets also notes that global capital has recently rotated away from crowded AI and semiconductor trades in markets like Taiwan and South Korea, creating room for incremental allocations toward India.
Despite the recent optimism, foreign investors remain net sellers for the year, with total withdrawals for 2026 at ₹2.23 lakh crore versus ₹1.66 lakh crore outflows in all of 2025, per the report. Market watchers remain cautious due to Middle East tensions, crude oil volatility, and elevated US bond yields ahead of the Fed’s September policy meeting, and they also point to potential US-Canada trade frictions.
In the debt market, LiveMint Markets reports that foreign investors were largely defensive, pulling ₹2,318 crore through the general route while offset by minor inflows of ₹627 crore. It also flags upcoming Q1 GDP growth and inflation data as the next catalysts for institutional flows.
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