FPIs turn net buyers after 9-day selling spree, pump ₹6,065 cr into Indian stock market amid global trade relief

Foreign portfolio investors (FPIs) turned net buyers in the previous trading session, pumping ₹6,065 crore into the Indian stock market, ending nine consecutive days of selling streak that had resulted in cumulative outflows of ₹38,992 crore. FPIs were last net buyers on March 27, where they bought equities worth ₹11,111.25 crore—the highest single-day buying so far in 2025.

The shift in sentiment among overseas investors followed U.S. President Donald Trump easing some of his harsh tariff decisions on key trading partners. Investors have also taken note of the White House's ongoing trade discussions with most major economies, raising hopes that a broader trade truce could be on the horizon and help reduce global market uncertainty.

After pumping ₹32,576 crore into Indian equities between March 20 and March 27, FPIs turned net sellers in the first half of April. In February, FPIs pulled out ₹34,574 crore, while January saw an even higher outflow of ₹78,027 crore, according to the NSDL data.

Between October 2024 and February 2025, FPIs withdrew more than ₹3 lakh crore from the Indian stock market, largely due to concerns over stretched valuations and weak corporate earnings.

As of end-March 2025, foreign institutional investor (FII) equity assets under custody (AUC) stood at ₹66.8 trillion, marking a 7% increase from ₹62.4 trillion in February 2025, according to analysts.

Indian stock markets staged a sharp rebound over the past few sessions

The Indian stock market has sustained a strong upward momentum in recent sessions, with the Nifty 50 and Sensex rising over 7% in the past five trading days, as easing trade tensions—following President Donald Trump's decision to delay some tariffs and signal a pause on others—lifted investor sentiment

Trump on Monday suggested that he might temporarily exempt the auto industry from the tariffs he previously imposed on the sector in order to give carmakers time to adjust their supply chains.

Prior to this, Trump on Friday issued exemptions for Chinese-made semiconductors and electronics amid warnings that U.S. consumers could face skyrocketing prices for products such as smartphones and laptops, although a 20% rate will still be imposed on electronics.

Last week, after a bond market sell-off pushed up interest rates on U.S. debt, Trump announced that for 90 days, his broader tariffs against dozens of countries would instead be set at a baseline 10% to allow time for negotiations.

At the same time, Trump increased import taxes on China to 145% in response to China’s 125% tariff on American goods. Both countries are continuing to slap duties on each other, raising the risk of a global economic fallout, especially as the two nations together account for 45% of the world’s GDP.

Meanwhile, Trump urged China to reach out to him in order to kick off negotiations after the nation ordered its airlines not to take any further deliveries of Boeing Co. jets. The Trump administration may use tariff negotiations to try to pressure U.S. trading partners to limit dealings with China, the Wall Street Journal reported, citing people with knowledge of the conversations.

Will the rally in the Indian stock market continue?

Domestic brokerage firm Kotak Institutional Equities, in its latest note, stated that there is no change in the U.S.’s strategic goals, which continues to create significant uncertainties for countries (in terms of tariff levels), exporters (regarding new capex and orders), and companies (impact on earnings).

The U.S. has temporarily suspended reciprocal tariffs for 90 days for all countries—except China—in order to negotiate trade deals, though the base tariff of 10% remains.

Kotak sees a modest upside for Indian markets, which have held up relatively well compared to global peers due to India’s relatively low export-to-GDP ratio, the dominance of defensive and domestic sectors in market earnings, and the broader narrative of India being better positioned under a reciprocal tariff regime.

Despite this ‘positive’ development, Kotak maintains its cautious stance on Indian equities, citing fair-to-expensive valuations across most sectors and continued uncertainties around the global tariff situation.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.