Foreign institutional investors (FIIs) were net sellers this week, offloading Rs 7,570 crore, while domestic institutional investors (DIIs) bought Rs 16,950 crore, providing stability. In May, FIIs sold Rs 32,230 crore, whereas DIIs purchased Rs 56,870 crore based on exchange data. FIIs were net buyers on Monday with an inflow of Rs 2,810 crore but turned net sellers in the rest of the week with an outflow of Rs 10,380 crore. DIIs remained net buyers throughout the week with an inflow of Rs 16,950 crore.
Benchmark indices experienced volatility last week, fluctuating between gains and losses amid market uncertainty. Nifty traded within the range of 23,300-23,850, testing upper and lower levels multiple times, closing the week at 23,719, up by 0.3%. Analysts highlight concerns over the Indian rupee’s weakness against the US dollar despite global equity resilience, impacting foreign investors’ sentiment towards emerging markets like India.
The persistent weakness in the currency raises imported inflation risks and keeps FIIs cautious. Market stability heavily relies on domestic institutional inflows to counter FII selling pressure. Geopolitical tensions and elevated crude oil prices contributed to cautious investor sentiment. Rising bond yields, driven by inflation fears and potential higher interest rates, added to market uncertainties. Global economic challenges led to cautious trading, with institutional flows sensitive to US–Iran tensions and oil price movements.
