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Below the Commentary on Monthly FII and DII 02nd October by Pabitro Mukherjee, Deputy Vice President-Research, Bajaj Broking

FII AND DII WEEKLY ACTIVITY: 02-10-26

Foreign Institutional Investors (FIIs) continued to remain net sellers in the past week, offloading equities worth Rs 349.7 bn crore based on provisional exchange data. On the other hand, Domestic Institutional Investors (DIIs) provided strong support to the market, emerging as net buyers with investments totalling Rs 334.6 bn.

The broader trend remains unchanged on a month-to-date basis. FIIs have pulled out a substantial Rs 440.1 bn from Indian equities during September 2026, while DIIs have infused Rs 760.3 bn during the same period. FII remained net seller in market for the 15th consecutive month as per provisional figures.

Benchmark indices continued to face selling pressure amid a challenging global backdrop, with elevated US bond yields, firm Brent crude prices and sustained FII outflows weighing on sentiment. Uncertainty surrounding the prospects of a peace deal involving Iran, coupled with a depreciating rupee, further added to investor caution. The Nifty extended its losing streak for the eighth consecutive week, reflecting persistent risk aversion. Elevated crude prices also heightened concerns over inflation and the domestic macro-outlook, while rising global yields continued to constrain risk appetite. Nifty started the week on a negative note and dragged lower as the week progressed with sharp selling pressure on Thursday session. Nifty closed lower for all the four session during last week and closed the week down by 3.1% at 22,422 levels. Bank Nifty also witnessed sharp selling pressure and closed the week down by 2.0%. Broader market under performed with Nifty Midcap and Small cap index closed lower by 3.6% and 3.4% respectively.

Market participants will closely track Brent crude oil prices and developments surrounding US-Iran geopolitical tensions, which remain key drivers of global risk sentiment and foreign institutional flows. October presents a heavy calendar of policy, macroeconomic and corporate events for Indian markets. The RBI’s Monetary Policy Committee meeting is scheduled for October 5–7, followed by the 57th GST Council meeting on October 7 and the release of the US Federal Reserve’s September meeting minutes on the same day. The Q2 FY27 earnings season is set to begin with TCS on October 8, while September CPI and WPI inflation data are due on October 12 and 14, respectively. Pre-Budget consultations for Budget 2027–28 will also continue from October 12 through mid-November. Globally, attention will remain focused on the US Federal Reserve’s October 27–28 policy meeting. With multiple macro and corporate triggers lined up, volatility and institutional flows are likely to remain closely linked to developments in crude oil, interest rates, inflation and geopolitical risks.

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