FII Flows

FIIs have turned cautious on Indian equities, selling ₹1.07 trillion amid Iran war risks. BNP Paribas flags oil, inflation, CAD and earnings concerns.

Foreign outflows, the West Asia conflict, rupee depreciation, uncertainty around US tariffs, and elevated valuations were among the key factors that influenced investor sentiment

Analysts expect FIIs to stay cautious on Indian equities in H1FY27 as global risks weigh. They, however, see flows returning in H2FY27. Strong DII inflows could also support Indian markets.

For FII's, the favored markets over last two years have been countries that were beneficiaries of new age tech and artificial intelligence (AI), he said.

Utsav Verma of Choice Institutional Equities said that long-term investors should deploy funds in a staggered manner in sectors with stronger earnings visibility

Strategy for 2026, he said, is shifting toward sectors with a probable growth visibility such as Banking, Consumer, Resources and Manufacturing.

In January 2026, mutual funds increased their exposure to domestic sectors such as services, cement, real estate, consumer services, financial services, and power & utilities

The correction in the tech pack has been driven by mounting concerns among investors over the potential impact of AI on the sector's growth outlook

The reduction in US tariffs and the interim trade deal framework are set to significantly boost India's export competitiveness, said Subhash C. Aggarwal

Jan'26 witnessed sharpest outflow of Rs333bn since Aug'25. FMCG, healthcare and consumer services saw highest outflows in Jan'26

The India-US trade deal, Antique believes, is significantly positive for Indian equities as FPI equity outflow of $34 billion since October 2024, the highest among emerging markets (EMs), may reverse

India's structural story (demographics, digitisation, manufacturing) is intact despite tactical noise, said Mehta

Our analysis over past two decades suggests Nifty sustains higher valuations only during periods of strong earnings growth/upgrades, which is unlikely next year, Shah said.

Sensex Today | Stock Market LIVE Updates, December 9, 2025: In the broader markets, the Nifty MidCap index was up 0.32 per cent, and the Nifty SmallCap index was up 1.14 per cent

Sensex Today | Stock Market Highlights, December 8, 2025: In the broader markets, Nifty Midcap 100 index closed 1.83 per cent lower, while Nifty SmallCap 100 index settled 2.6 per cent lower

Sensex Today | Stock Market close, Dec 5, 2025: In the broader markets, the Nifty MidCap index gained 0.49 per cent, and the Nifty SmallCap index dropped 0.57 per cent

Nvidia projected fourth-quarter revenue of $63.7-66.3 billion, topping the $61.98 billion average analyst estimate, according to Bloomberg

As the global artificial intelligence (AI)-led trade moderates due to rich valuations, India will re-emerge as one of the most attractive growth markets in a slowing global environment, Karwa said

The US could substantially slash tariffs on Indian exports as the two countries near a trade deal that could see New Delhi cutting oil purchases from Russia, according to reports

The strong domestic flow, meanwhile, offset the selling by foreign portfolio investors (FPIs) during CY25, who pulled out $23.3 billion (Rs 2.03 trillion) from the domestic equity markets.