Analysts said on Sunday that if global trade tensions subside, it is reasonable to anticipate further inflows of foreign portfolio investors (FPIs), who in July were net sellers in the Indian equity market.
According to data supplied by NSDL, FPIs made a total outflow of Rs 17,741 crore last month, which represents a change from three consecutive months of inflows in April, May, and June.
January saw the biggest sell-off, with net outflows of Rs 78,027 crore, while May saw the largest FPI inflows to date in 2025.
In July, FPIs sold equities on the exchanges for a total of Rs 31,988 crores. With this sale, the total amount sold in 2025 will be Rs 13,1876 crores. However, with a monthly purchase amount of Rs 14,247 crores, the FPI strategy of purchasing stock through the primary market still persisted in July, according to VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited.
Up until now, FPIs have invested a total of Rs 36,235 crores through the main market in 2025. According to Vijayakumar, this is a consistent pattern that reflects the FPI’s preference for fair assessments.
US President Donald Trump offered Russia a 10- to 12-day ultimatum last week to stop the war in Ukraine, failing which new penalties and secondary tariffs on nations that trade with Russia could be imposed, which would raise the price of oil. According to Vijayakumar, this action has had a short-term effect on market mood.
“FPI inflows may be impacted in the near future by the headwind of the dollar index’s steep increase to 100. The market believes that after the initial confusion, the next round of negotiations between the U.S. and India will result in a settlement. Once the dust settles, a consistent pattern of FPI flows will become apparent,” Vijayakumar continued.
“FPI selling in information technology (IT) stocks pushed down the IT index, and the uncertainty relating to pharmaceuticals impacted the pharma index, too, despite the good results from many companies in the sector,” he stated.
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