India's Stock Market Defies Foreign Selling Spree

Foreign Investors Sell Indian Stocks at Record Pace

Foreign investors have been selling Indian stocks at an unprecedented rate, with Rs 152 crore worth of stocks being sold every trading hour in 2025 so far. Despite this, India's stock market has remained resilient, thanks to domestic institutional investors who have been buying stocks with systematic investment plans (SIPs).

A Structural Shift in Indian Markets

Foreign institutional investors (FIIs) have sold over Rs 2.23 lakh crore worth of Indian equities through the secondary market this year. However, domestic institutional investors (DIIs) have absorbed this selling pressure, buying shares worth around Rs 39,965 crore in December alone.

This trend highlights a continuing structural shift in Indian markets, with retail investors playing a significant role in the market's resilience. Mutual funds have seen a steady inflow of funds, particularly through SIPs, which has strengthened domestic institutions.

Expert Insights

According to VK Vijayakumar, Chief Investment Strategist at Geojit Investments, SIP inflows have remained consistently above Rs 29,000 crore over the past three months. He believes that sustained foreign selling becomes difficult to maintain in the face of such steady domestic inflows.

Vijayakumar also notes that foreign investors have not turned uniformly negative on India, with FIIs investing around Rs 67,000 crore in the primary market in 2025 so far. This includes participation in IPOs and other capital-raising exercises, suggesting continued confidence in India's long-term growth story.

Key Drivers for the Market

Vijayakumar emphasizes that the single most important driver for the market will be earnings growth, which appears promising as India moves toward FY27. Other factors, such as rupee depreciation and global uncertainty, may be short-term drags rather than structural concerns.

Overall, India's stock market has shown remarkable resilience in the face of foreign selling, thanks to the steady inflow of domestic funds and the growing maturity of the country's equity ecosystem.

• Key keywords: Indian stocks, foreign investors, domestic institutional investors, SIPs, mutual funds, earnings growth, FY27
• Related topics: stock market, investments, finance, economy, India