Exodus continues in 2026: FPIs dump $3 bn in 16 sessions
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Foreign portfolio investors (FPIs) have pulled out ₹32,253.55 crore, or $3.96 billion, from the Indian equities so far this month across 16 trading sessions, as heavy selling pressure outweighed fresh inflows. Data from the National Securities Depository Ltd (NSDL) showed that gross purchases by FPIs stood at ₹1,53,046.26 crore while gross sales rose to ₹1,85,299.81 crore. On January 20 alone, FPIs were net sellers of Indian equities worth ₹2,938.33 crore. This marks the worst monthly FPI outflow since August 2025, when withdrawals touched ₹34,993 crore.
Domestic institutional investors (DIIs), however, continued to absorb foreign selling. Month-to-date, DIIs have invested a net ₹41,976.70 crore in equities, with purchases of ₹2,24,667.96 crore, significantly exceeding sales of ₹1,82,691.26 crore. On January 20, DIIs remained net buyers as well, pumping in ₹3,665.69 crore to the market.
Market reacts
Meanwhile, markets continue to slide after seeing a sharp decline in Tuesday’s trade. Currently, the BSE Sensex is at 81,610.57, down by 569.90 points or 0.69%, whereas the NSE Nifty50 is at 25,071.90, falling 160.60 points or 0.64%.
On Tuesday, the Indian stock markets ended in the red, with the Nifty 50 slipping below the 25,300 level. The Sensex crashed 1,065.71 points, or 1.28%, to close at 82,180.47. The Nifty 50 fell 353.00 points, or 1.38%, to 25,232.50.
January 2026
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Under pressure, the Indian rupee also extended its decline on Wednesday, sliding 32 paise to touch a fresh all-time low of 91.29 against the U.S. dollar.
In early interbank trade, the rupee opened at 91.05 and weakened sharply to 91.296 against the greenback, slipping 32 paise from its previous close.
On Tuesday, the domestic currency had dropped 7 paise to end at a record low of 90.97 against the dollar. The rupee had earlier touched an intraday low of 91.14 and had recorded its weakest closing level of 90.93 on December 16, 2025.
What is driving the continued exodus of FPIs?
According to analysts, the sell-off was triggered by renewed trade war concerns after U.S. President Donald Trump escalated tariff threats on select European nations opposing U.S. control over Greenland, with proposed duties rising from 10% in February to 25% by June.
"Renewed U.S. tariff threats, coupled with persistent foreign investor selling, continue to weigh heavily on market sentiment. The rupee remains vulnerable, keeping import-cost risks elevated, while Q3 earnings have so far been mixed to weak across several heavyweights, particularly in IT, Auto, Realty, and select Financials," said Ponmudi R, CEO, Enrich Money.
With respect to market sentiment, Ponmudi said ahead of the Union Budget on February 1, expectations of a capex push in railways, defence, and consumption support remain constructive, but these positives are not yet strong enough to counter the prevailing global uncertainty. "Short-term technical bounces may emerge if DII inflows absorb supply or if FII selling eases, but investor confidence in the sustainability of such moves remains low in the current environment."