FPI Selling Latest Update: Continuous selling by foreign investors in the Indian stock market has increased the concerns. So far in the month of March, foreign portfolio investors (FPIs) have sold Indian stocks worth about $11 billion (about Rs 1 lakh crore).

This is being considered as their biggest one month sale till date. This round of selling comes at a time when the valuation premium of Nifty-50 has come down, bringing it closer to global market levels; Yet, despite this, foreign investor confidence remains weak.

Record-level selling

According to Bloomberg data, the largest ever FPI outflow has been seen in March 2026. Earlier, in October 2024, these foreign investors had sold shares worth about $10.9 billion. Additionally, significant outflows totaling approximately $8.4 billion were also recorded in January 2025 and March 2020 during the COVID-19 period. However, the figures recorded this time are much more than all those previous cases.

Why are foreign investors exiting the market?

Experts cite several main reasons behind this exodus of foreign investors. The main reason for this is the increase in US bond yields. US Treasury yields have risen 50 basis points to about 4.4% since the beginning of March, making risk-free investments relatively more attractive.

Along with this, the Indian Rupee has also weakened, which has had a negative impact on the returns received by foreign investors. Fall in the value of rupee means reduction in returns in dollar form for investors, due to which they are preferring to withdraw their capital prematurely.

Pressure increased due to weakness of rupee

The rupee weakened by about 4% during the month of March and reached a record low of 94.78 against the US dollar on March 27. A weak currency proves to be a double blow for foreign investors: on the one hand, the stock market falls. On the other hand, they have to suffer losses due to adverse changes in currency exchange.

Crude oil prices still remain a matter of concern

Amidst the ongoing geopolitical tensions in West Asia, Brent crude oil prices have consistently remained above the $100 per barrel level. For an oil importing country like India, this situation is considered negative, because it increases inflation and increases current account deficit. There is pressure on corporate earnings.

cut earnings estimates

Market analysts have now started cutting the earnings estimates of Nifty companies by 2–3% for FY 2026. According to Bhanu Baweja, Global Strategist at UBS, “FPI inflows into India are likely to remain slow for the time being. The rupee may also continue to trade in a weak state. This means that there is no possibility of foreign investment picking up again in the near future.

FPI’s share in Indian market

According to National Securities Depository Limited (NSDL), as of March 15, foreign investors had about $710 billion invested in the Indian equity market, which is about 15% of the total market capitalization.