FIIs have been net sellers, extending their recent selling trends due to tariff-related uncertainties and geopolitical tensions, said Ajit Mishra, senior vice-president of research at Religare Broking.
Given the mixed domestic and global backdrop and continued foreign fund outflows, leverage and position size must be managed judiciously, he recommended.
FIIs were net sellers in December, with Rs. 22,611 crore offloaded domestic shares while the total outflow in 2025 is Rs. 1,66,286 crore had been reached.
FIIs in the third quarter of CY25 raised Rs. 76,619 crore in Q3 after offloading shares to Rs. 11,766 crore worth of shares were sold. They reversed the buying trends seen in the April-June period when a total of Rs. 38,673 crore was inflow. During the January-March quarter, foreign investors invested Rs. The year opened on a sharp negative note with massive withdrawals of Rs 1,16,574 crore.
Market expert V.K. Vijayakumar attributes India’s relatively high valuation and AI trade as the main factors behind the FII exit last year. Their continued selling has also contributed to the Indian rupee’s significant decline against the US dollar, said chief investment strategist at Geojit Investments.
On Nifty’s possible moves, next week, Religare’s Mishra said a decisive break from the existing consolidation range will give clues for the next directional move. He said market participants should focus on quality large-cap and large midcap stocks, especially in sectors with strong earnings visibility and institutional interest. IT, metals and preferred PSU names are preferred sectors for that.
Exposure to rate-sensitive sectors like realty and capital goods should be limited, he added.
(disclaimer: Recommendations, suggestions, opinions and views given by experts are their own. (These do not represent the views of The Economic Times)
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