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West Asia war weighs on India’s markets, FPI outflows jump in H1
Foreign portfolio investor outflows nearly doubled to ₹60,847 crore in H1 FY27, while Nifty 50 gained just 3% despite frequent trading-day declines.
India’s first half of fiscal year 2027 has ended on a fragile note as the seven-month West Asia war has reshaped market conditions from April to September, according to LiveMint Markets. The outlet says the external environment has become more hostile even as domestic growth held up in the June quarter, with the economy expanding 7.8% versus 6.9% a year earlier.
LiveMint Markets reports that the lack of AI-led investment opportunities also diverted foreign capital toward East Asian emerging markets such as South Korea and Taiwan. As a result, foreign portfolio investor outflows nearly doubled to ₹60,847 crore in H1 FY27, up from almost ₹35,000 crore in H1 FY26, weighing on market returns.
The outlet adds that the benchmark Nifty 50 rose just 3% in H1 FY27, compared with a 6% gain in the same period last fiscal. It notes the market fell on nearly half of the 125 trading days in both periods.
LiveMint Markets attributes the weaker recovery prospects to the conflict being “structurally stickier” than earlier shocks, citing commentary from JM Financial Institutional Securities’ Venkatesh Balasubramaniam. It also points to higher oil prices, saying Brent averaged $92 a barrel in H1 FY27, 35% higher than $67 in H1 FY26, which widened India’s import bill, revived inflation pressures, and squeezed corporate profitability since the first quarter.
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