FIIs reverse trend: Rs 3,243 cr bought in April, Rs 40,145 cr in last 12 days

Synopsis

Foreign Institutional Investors (FIIs) have shifted from being net sellers to net buyers in Indian equities, purchasing ₹40,145 crores in the last 12 trading days. This reversal is attributed to President Trump's tariff pause and a weakening US dollar, which boosted emerging markets like India. However, modest earnings growth of around 5% in FY25 may constrain future FII inflows.

Foreign Institutional Investors (FIIs) have reversed their earlier selling stance and turned net buyers in Indian equities, marking a significant shift in strategy. In April, FIIs turned buyers, having bought equity for Rs 3,243 crore.

FIIs had been consistent sellers through the exchanges during the first quarter of calendar year 2025. Over the three-month period, they cumulatively sold equities worth Rs 1,29,680 crore. However, in April, this trend reversed.

According to Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, the reversal in FII strategy in India from selling to buying continued for the week ending 2nd May. It is important to put this trend reversal in context.

The momentum of buying accelerated further in the cash market.

“During the last 12 trading days, FIIs have been sustained buyers in the cash market, having bought equities for Rs 40,145 crores cumulatively,” Vijayakumar added. This represents a marked pivot in FII behavior after prolonged selling pressure earlier in the year.

Also read: SBI Q4 results: Net profit slides 10% YoY to Rs 18,642.59 cr, NII surges 3%

He also highlighted two major factors that triggered the shift in FII flows. First- President Trump’s announcement of 90 day pause in reciprocal tariffs led to a recovery in global equity markets. In this recovery, India outperformed.

Second, the weakening of the U.S. dollar contributed to the reversal in momentum trade. He explained, “The steep decline in the Dollar index from 111 on 11th January to 99 recently facilitated FII inflows to emerging markets, particularly India.”

Looking ahead, Dr. Vijayakumar noted that FII inflows can remain stable but will be constrained by the modest earnings growth of around 5% in FY25.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

...moreless

...moreless