FPIs Make a Strong Comeback to Indian Equities

Foreign Portfolio Investors (FPIs) have shown a renewed confidence in Indian equities, infusing nearly Rs 8,500 crore last week. This surge in investment comes amid signs of India's economic resilience and its relative immunity to global trade shocks.

During the holiday-shortened trading week ended April 18, FPIs made net investments of Rs 8,472 crore in the equity markets. This included a withdrawal of Rs 2,352 crore on April 15, followed by a robust inflow of Rs 10,824 crore over the next two sessions.

Sentiment Shift Amid Global Headwinds

Despite heavy outflows earlier this month, the latest trend suggests a possible turnaround in FPI sentiment. Experts believe the sustainability of these inflows will hinge on global macroeconomic stability, clarity on U.S. trade policy, and India's domestic growth trajectory.

Dollar Weakness and Growth Differential Driving Inflows

The recent FPI buying has been attributed to a weakening dollar index and expectations of further dollar softness, prompting global investors to shift capital towards emerging markets like India. With India projected to grow at 6 per cent in FY26, this relative economic outperformance is likely to attract more investments.