Foreign Portfolio Investors Withdraw Rs 7,443 Crore from Indian Equities in September

Mumbai: Foreign portfolio investors turned net sellers in Indian equities in the first week of September, withdrawing Rs 7,443 crore as rising crude oil prices, higher US bond yields and a stronger dollar weakened appetite for emerging-market assets. The selling ended two consecutive months of inflows. FPIs had invested more than Rs 29,600 crore in August and Rs 20,200 crore in July, after remaining net sellers for four straight months from March to June. With the latest withdrawal, total FPI outflows from Indian equities have climbed to Rs 2.32 lakh crore so far in 2026, already exceeding the Rs 1.66 lakh crore pulled out during the whole of 2025. The September figures cover trading activity through September 4, according to data from the National Securities Depository Limited. Rajkumar Rathi, Chief Investment Officer at YES Securities, said the rebound in crude oil prices has raised concerns about India's inflation and current account outlook. Higher US bond yields and a firm dollar have also reduced foreign investor appetite for emerging markets. Premium valuations in Indian equities, particularly across growth sectors and mid and small cap stocks, have encouraged foreign investors to book profits and rebalance portfolios. Despite selling in the secondary market, foreign investor interest in India's primary market remains resilient. The strong pipeline of upcoming IPOs could continue attracting foreign capital, particularly if companies price their public offerings attractively. Foreign fund flows are expected to remain sensitive to movements in global bond yields. Investors will also track Brent crude oil prices, US Iran geopolitical tensions and upcoming US inflation data ahead of the Federal Reserve's September policy meeting. FPIs also sold debt securities during the period. They withdrew Rs 377 crore through the Fully Accessible Route and Rs 231 crore through the Voluntary Retention Route, while investing Rs 217 crore through the general route.