Daijiworld Media Network - Mumbai
Mumbai, Mar 22: Foreign portfolio investors (FPIs) have withdrawn a massive Rs 88,180 crore (around $9.6 billion) from Indian equities so far this month, weighed down by escalating tensions in West Asia, a weakening rupee and rising crude oil prices.
The sustained sell-off follows a strong inflow trend in February, when FPIs invested Rs 22,615 crore—the highest monthly inflow in 17 months—according to data from National Securities Depository Limited.
With the latest outflows, total FPI withdrawals in 2026 have crossed the Rs 1 lakh crore mark. Notably, investors have remained net sellers throughout March (till March 20), offloading equities consistently in the cash market. However, the outflow is still marginally lower than the record Rs 94,017 crore sell-off seen in October 2024.
Market experts attributed the trend to global macroeconomic pressures and geopolitical uncertainties. Vaqarjaved Khan of Angel One said rising tensions in the Middle East and fears of disruption in the Strait of Hormuz have pushed Brent crude prices above $100 per barrel, triggering a risk-off sentiment among global investors.
He added that a weakening rupee, hovering near 92 against the US dollar, elevated US bond yields, and profit-booking after February’s rally have further intensified the selling pressure. A mixed outlook for Q4 earnings has also contributed to cautious investor sentiment.
Himanshu Srivastava of Morningstar Investment Research India pointed to rising US Treasury yields as a key factor, noting that higher returns on dollar-denominated assets have prompted investors to shift funds away from emerging markets like India.
Sharing similar views, V K Vijayakumar of Geojit Investments said the combined impact of global market weakness, rupee depreciation and concerns over high crude prices has weighed on investor confidence.
Sector-wise, financial services witnessed the highest outflows, with FPIs selling shares worth Rs 31,831 crore during the fortnight ended March 15.
Analysts believe the near-term outlook remains cautious, with continued volatility in oil prices and geopolitical developments likely to influence investor behaviour. However, easing tensions, strong domestic institutional support and positive earnings surprises could help stabilise the markets.