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Below the  Quote on FPI Flows in Indian Markets by Dheeraj Gaur, Chief Investment Strategy Officer at Choice Wealth

FPIs took a day’s breather in Equity & Debt on Tuesday and Thursday respectively where they bought ~Rs 2,000 crore each as per settled data. The week still ended in the red.

Equity Flows: No respite in sight
On the provisional exchange data, FPIs sold rs1,708 crore on Monday, Rs 1,305 crore on Tuesday, Rs 1,857 crore on Wednesday and a hefty rs 5,285 crore on Thursday. Then came Friday — a welcome, but modest, Rs 1,166 crore of buying. That leaves provisional FPI selling at about Rs 8,990 crore for the week.

Friday’s buying also snapped a 15-session selling streak that had started on 24 September. Over that stretch, FPIs had sold roughly Rs 84,000 crore on provisional numbers.

However, the more meaningful number is the settled data. The five reporting days show FPI equity flows of –Rs 3,251 crore, +rs 2,001 crore, –rs 1,436 crore, –Rs 1,102 crore and –Rs 4,146 crore. That adds up to a settled outflow of rs 7,934 crore.

So, whether you look at the tape or the money that actually settled, the message is broadly the same: foreign investors are still selling.

And the monthly number is becoming harder to ignore. October’s settled equity outflow has now reached about Rs 52,100 crore, already well above September’s Rs 35,861 crore, with two weeks of the month still to go. Calendar-2026 FPI equity outflows are now well over the rs 3 lakh crore mark.

The primary-market cushion has also become thinner. September had provided a much needed offset, with strong foreign participation in primary issues. Comparatively, October so far, has been much quieter.

That makes Jio Platforms’ IPO particularly interesting. At up to rs 30,213 crore, it is set to become India’s largest IPO yet, with bidding scheduled for 21–23 October and anchor bidding on 19 October.

There is, however, one striking disconnect: FPIs are selling, but Indian equities are not behaving like a market under foreign-investor stress.

The Nifty gained 2.8% over the week to 23,146, while the Sensex rose 3.1%. Nifty IT was the standout, jumping 11.7% on optimism around AI-related revenues and technology earnings.

Domestic institutions once again played the shock absorber, buying heavily even as foreign investors continued to reduce exposure.

FPIs continue to sell the neighbourhood. They just stopped for one afternoon.

Debt Flows: Not much appetite for Indian bonds either
The debt picture was softer too. Settled data shows FPIs were net sellers of around rs 1,580 crore in debt during the week, with selling spread across the general limit and VRR segments, partly offset by buying through FAR.

The latest settled print on 16 October alone showed rs 1,071 crore of net debt selling — including roughly rs 212 crore of selling through VRR and Rs 869 crore through FAR, partly offset by a small rs 9 crore purchase under the general limit.

The hesitation is understandable. India’s 10-year G-sec yield climbed to around 7.4%, with the benchmark touching 7.41% during the week. Higher domestic yields should, in theory, make Indian bonds more attractive to global investors. But when those higher yields are accompanied by rupee weakness, tighter liquidity and rising global yields, the equation becomes less straightforward.

For now, foreign investors may be waiting for greater clarity rather than rushing to lock in Indian bond yields.

Why are FPIs still selling?
It is still the same cocktail — shaken not stirred

US yields: September CPI came in at 3.7% against 3.6% expected, pushing the 10-year Treasury back to about 5.3% – a day after it neared its 24-year high of 5.365% – and the dollar index to an 18-month high, keeping the dollar attractive and making emerging-market assets compete harder for foreign capital. The odds of a Fed hike on 28 October jumped from roughly 22% to over 40%, so last week’s weak-payrolls relief also proved short-lived.

Oil: Brent opened the week at $104.95 and touched $110 on Friday.

The Rupee: the one genuine positive. USD/INR eased about 1.9% to 95.07 after the RBI announced a dedicated dollar window for public-sector oil marketing companies, a rs 25,000 crore G-sec open-market sale and a 99% daily CRR maintenance requirement from 16 October. This comes on back of the 25 bps repo hike to 5.50% on 7 October and the shift to “calibrated tightening”.

Rotation: the AI-led rally in North Asian markets keeps competing for the same foreign dollars. In other words, it’s all about “where should the next dollar go?”

The silver lining, if one is needed
India still has a strong answer to that question — but unfortunately, right now, it isn't the only answer.

India’s growth story has not suddenly disappeared. The IMF has raised its 2026 growth forecast for India to 7%, while the RBI’s own projection is slightly higher at 7.1%. Add the resilience of domestic liquidity, makes that distinction even more important.

What to watch next week?
A four-session week – markets are closed on Tuesday, 20 October for Dussehra. The key signals for FPI flows:
Jio Platforms IPO (21–23 October): India’s largest ever, at rs 30,213 crore with a price band of rs 1,065–1,119, alongside Paras Healthcare’s rs 1,450 crore issue and nine listings (including Zetwerk, Tonbo Imaging and Bonfiglioli on 23 October). The best test yet of whether foreign appetite for primary deals survives the macro noise.
Fed meeting on 28 October: hike odds sit at roughly 40–47%; US 10-year yield and the Dollar Index remain the key global variables.
Brent crude and USD/INR: whether the rupee holds around Rs 95 now that the RBI’s measures are in place and whether Brent stays near $110.
India G-sec yields and RBI liquidity operations: the 10-year near 7.4%, the Rs 25,000 crore OMO sale and the CRR change, all of which will impact FAR demand.
Q2 earnings: HDFC Bank, ICICI Bank and Axis Bank results land over the weekend, so Monday’s reaction in financials will matter for FPI positioning.
The views are personal. Data points are referenced from publicly available information, internal sources and other third-party sources believed to be reliable. While every care has been taken to ensure veracity of data, the writer cannot guarantee the accuracy of such information, assure its completeness, or warrant that such information will not be changed. The information in this report may include inaccuracies or typographical errors.

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