Rs.4,563 Crore Equity Inflows Signal Renewed Optimism as FPIs Return as Net Buyers After Brief Pause

Foreign Portfolio Investors (FPIs) resumed net buying activity in Indian equities in the week ending July 11, with cumulative equity inflows of ₹4,563.14 crore. This marked the fifth consecutive week of net inflows, reflecting continued confidence in India’s macroeconomic resilience despite global trade uncertainties.

Sustained Equity Inflows Mark Fifth Consecutive Positive Week

FPIs displayed strong interest in Indian equities throughout the past week, with daily net inflows from July 7 to July 11 steadily contributing to the overall positive momentum. According to NSDL data, daily net equity investments stood at ₹691.97 crore (July 7), ₹1,756.74 crore (July 8), ₹806.91 crore (July 9), ₹107.25 crore (July 10), and ₹45.02 crore (July 11).

This culminated in a weekly total of ₹4,563.14 crore in net equity inflows, underscoring the broad-based optimism foreign investors are exhibiting toward India’s earnings outlook and macroeconomic stability. On Friday alone, ₹839.75 crore was invested in equities, of which ₹829.50 crore flowed through stock exchanges and ₹10.25 crore through primary market subscriptions.

Highlights:

• Weekly net FPI equity inflow: ₹4,563.14 crore

• Daily equity inflows: Consistently positive from July 7 to July 11

• Equity route dominance: Stock exchange transactions led daily activity

• Gross equity trades on Friday: Purchases worth ₹12,013.95 crore; sales of ₹11,184.45 crore

Also Read : Q1 FY26 Outlook Mixed for Consumer Discretionary Sector, Says HDFC Securities

Selective Approach to Debt as US Dollar Weakens

While the equity segment saw uniform inflows, the debt market remained more nuanced, driven by a selective investor approach.

On July 11:

• Debt-General Limit: ₹336.24 crore net inflows (₹300 crore via primary markets)

• Debt-VRR: ₹159.57 crore net inflows

• Debt-FAR: ₹866.37 crore net outflows

Market analysts attributed the cautious approach in debt to macroeconomic uncertainties in developed markets and dollar-rupee stability, which ranged between ₹85.39 to ₹85.82 during the week.

Himanshu Srivastava, Associate Director – Manager Research at Morningstar Investment, stated, “The weakening of the US dollar helped sustain flows into India, even as investors remain selective in their debt allocations.”

Derivatives Market Shows High Activity with Index Options Dominating

In the derivatives segment, FPIs maintained aggressive trading activity:

• Index Options:

  • Bought 12,282,715 contracts worth ₹2,339,119.97 crore

  • Sold 12,237,336 contracts worth ₹2,330,663.51 crore

• Stock Futures & Options:

  • Active participation seen across the board, pointing to robust hedging strategies

This reflects foreign investors’ growing use of derivative instruments for tactical positioning and risk mitigation, especially during the earnings season and amid rising global volatility.

Broader Market Sentiment Under Pressure Despite Foreign Support

Despite strong FPI flows, Indian markets ended the week in negative territory:

• Sensex: Down 689.81 points or 0.83% to 82,500.47

• Nifty 50: Down 205.40 points or 0.81% to 25,149.85

The market’s weak performance was attributed to:

• Tariff uncertainty led by potential US duties on Canadian imports

• Disappointing Q1 earnings kick-off, particularly in IT stocks

• Nifty’s drop below the 20-day simple moving average, suggesting near-term pressure

Ajit Mishra of Religare Broking noted, “Markets lost over a percent as caution set in ahead of key earnings. The tariff overhang has added to nervousness.”

Technical analyst Pravesh Gour added that if Nifty fails to hold above 25,150, the next key support level would be 24,935 – its 50-day SMA.

Earnings Season to Drive Next Phase of FPI Sentiment

With the Q1FY26 earnings season gathering pace, investor attention is expected to focus on corporate earnings visibility and management commentary.

Upcoming results include:

• HCL Tech Stock Price

• HDFC Life Stock Price

• Tech Mahindra Stock Price

• Axis Bank Stock Price

• Wipro Stock Price

• JSW Steel Stock Price

• Jio Financial Services Stock Price

Analysts expect that strong earnings and improved guidance could reinforce FPI confidence, while disappointing performance, especially in sectors like IT, FMCG, and autos, may limit near-term gains despite foreign buying.

Srivastava concluded, “Expectations of a stable interest rate environment in the US, coupled with improving global liquidity, are helping India remain a key beneficiary among emerging markets.”