Foreign portfolio investors (FPIs) net sold approximately ₹8,990 crore in Indian equity markets last week, even as a modest ₹1,166 crore in buying on Friday, 18 October 2026 snapped a 15-session selling streak that had run continuously since 24 September. Despite the persistent outflows, benchmark indices posted strong weekly gains — a disconnect that has caught the attention of market watchers.

Scale of the Outflows

Provisional exchange data shows FPIs sold ₹1,708 crore on Monday, ₹1,305 crore on Tuesday, ₹1,857 crore on Wednesday, and a hefty ₹5,285 crore on Thursday before Friday's reversal. Over the 15-session streak alone, provisional numbers show total net sales of roughly ₹84,000 crore.

October's settled equity outflow has already hit ₹52,100 crore — well above September's ₹35,861 crore — with two full weeks of the month still remaining. Calendar-year 2026 FPI equity outflows have now crossed the ₹3 lakh crore mark, according to Dheeraj Gaur, Chief Investment Strategy Officer at Choice Wealth.

Primary Market Cushion Thins Out

One buffer that partly absorbed earlier selling pressure has weakened. September had offered a meaningful offset through strong foreign participation in primary market issues, but October has been considerably quieter on that front, Gaur noted. With the secondary-market outflow accelerating and the primary-market pipeline slowing, the net drag from FPIs has widened.

Markets Defy the Selling Pressure

The most striking element of this week's data is the market's resilience. The Nifty50 rose 2.8 per cent over the week to close at 23,146, while the Sensex added 3.1 per cent. Nifty IT was the standout performer, surging 11.7 per cent on optimism around AI-related revenues and technology sector earnings.

'FPIs are selling, but Indian equities are not behaving like a market under foreign-investor stress,' analysts observed — a verdict that points directly to the growing weight of domestic capital in setting price direction.

Domestic institutional investors (DIIs) once again acted as a shock absorber, buying heavily even as foreign investors continued to reduce exposure. This pattern, now well-established across multiple quarters, signals a structural shift in who drives Indian market sentiment.

Macro Backdrop: Optimism and Headwinds

Confidence in the domestic economy received a formal endorsement this week when the International Monetary Fund (IMF) revised upward its GDP growth forecasts for India for FY27 and FY28, reinforcing the narrative of durable domestic momentum.

However, market watchers flagged several live risks: elevated crude oil prices, rising retail and wholesale inflation, mixed global cues, and the sheer persistence of foreign fund outflows. Notably, this is not the first episode in 2026 where FPI selling has collided with domestic resilience — but the cumulative ₹3 lakh crore outflow figure underscores just how sustained the foreign retreat has become.

With two weeks of October still to play out and global macro uncertainty unresolved, whether domestic institutions can continue to hold the line against accelerating FPI exits remains the central question for Indian equity markets heading into November.