Foreign investors pour $2.28 billion into Indian equities in ten days

Foreign portfolio investors (FPIs) have injected $2.28 billion into Indian equities during the last ten days, split evenly between purchases on stock exchanges and primary market issuances. The Jio Platforms listing on October 28 accounted for about $1.1 billion of the total inflow.

The listing price of Rs 1,358 per share represented a 21.4% premium to the issue price, and the stock closed at Rs 1,419. Meanwhile, global indices weighted toward artificial-intelligence and semiconductor stocks, such as the Nasdaq, Kospi and Taipex, experienced declines of up to 3.5% in a single session, with major companies like Samsung, Alphabet and Intel falling sharply over the month.

India’s domestic market, perceived as less exposed to AI-related volatility, attracted investors as the country's benchmarks rose 2% in October, outpacing other emerging markets. Brent crude fell to $104 per barrel from $115, and the Federal Reserve kept its policy rate in the 3.75%-4.00% range, leading the 10-year U.S. Treasury yield to ease to about 5.0%.

The rupee remained relatively stable after the Reserve Bank of India introduced measures aimed at currency stability, and speculation about possible changes to long-term capital-gain rules for foreign institutional investors added to the positive sentiment.

JM Financial noted that the current FPI sell-off across fiscal years 2025-2027 is the deepest on record, with foreign investors having net-sold $51.5 billion in secondary markets since July 2022 while buying $36.3 billion in primary issues and off-market deals. Over the past year, secondary flows totalled $39 billion and primary flows $9.2 billion. Consequently, India’s weight in the MSCI Emerging Markets index dropped from a peak of 20.0% in July 2024 to 10.7% in September 2026.

Looking ahead, market participants will monitor U.S. mid-term election results, movements in Brent crude, developments in the U.S.–Iran and Russia-Ukraine conflicts, and upcoming earnings reports for further cues on investor sentiment.

"Additionally, movements in Brent crude prices, developments in the US-Iran and Russia-Ukraine conflicts, and ongoing quarterly earnings announcements will remain key factors influencing investor sentiment," Pabitro Mukherjee, Deputy Vice President-Research at Bajaj Broking said.