Why FPIs’ Four‑Day Buying Streak Could Signal a Market Pivot – What You Must Know

• Four straight sessions of net FPI inflows – the longest buying streak in four months.
• ₹52.19 bn (≈$576 m) poured in, reversing a $19 bn sell‑off in 2025.
• The India‑U.S. trade‑deal interim framework appears to have stemmed the outflow tide.
• Analysts warn that sustainable momentum still hinges on earnings growth, AI clarity, and deal fine‑print.
• Peer giants Tata and Adani are already reshuffling exposure to capture the upside.

You missed the last FPI surge, and that cost you big gains.

Why the Four‑Day FPI Buying Streak Matters for Indian Equities

Foreign Portfolio Investors (FPIs) are the lifeblood of India’s market depth. Their collective decision to inject ₹52.19 bn across four trading days is more than a statistical blip; it signals a shift in risk appetite after a record $19 bn sell‑off in 2025. When overseas capital flows swing from net sellers to net buyers, volatility contracts, bid‑ask spreads tighten, and domestic investors enjoy a cheaper cost of capital. The immediate benefit is a lift in index valuations, but the underlying narrative is far richer – it reflects confidence in policy stability, macro‑fundamentals, and the promise of a more predictable trade environment.

Sector‑Wide Ripple Effects: From Tech to Infrastructure

FPIs don’t buy a single stock; they allocate across sectors based on macro themes. The current inflow is disproportionately weighted toward technology and renewable‑energy names, sectors that stand to gain from the emerging AI agenda and the India‑U.S. trade framework’s emphasis on high‑value goods. Infrastructure firms, especially those tied to logistics and ports, are also seeing a secondary boost as investors anticipate higher cross‑border freight volumes. In practical terms, this means higher forward‑PE multiples for tech firms and a modest re‑rating of capital‑intensive infrastructure assets as the cost of capital eases.

How Competitors Like Tata and Adani Are Positioning Amid the Inflow

Market leaders Tata Group and Adani Group have already signaled strategic recalibrations. Tata’s recent earnings call highlighted an accelerated rollout of AI‑enabled manufacturing lines, aiming to capture the same narrative that fuels FPI optimism. Meanwhile, Adani’s logistics arm is expanding its U.S. gateway terminals, directly aligning with the trade‑deal’s goal of smoother bilateral freight. Both conglomerates are likely to see a disproportionate share of the fresh foreign capital, as FPIs tend to gravitate toward blue‑chip stocks with clear exposure to policy tailwinds.

Historical Precedent: 2020 FPI Surge and Its Aftermath

The last time FPIs staged a comparable buying streak was in the second half of 2020, when the pandemic‑induced liquidity glut hit emerging markets. A six‑day net inflow of $3 bn lifted the Nifty index by roughly 8 %. However, that rally proved fragile; a subsequent earnings miss by several large‑cap names triggered a rapid outflow. The lesson? Inflows are a powerful catalyst, but they must be backed by solid fundamentals. Without earnings momentum, the market can quickly revert to a risk‑off stance.

Decoding the India–U.S. Trade Deal Interim Framework

The interim framework, signed earlier this year, reduces tariff barriers on a basket of high‑tech goods and creates a “fast‑track” visa regime for skilled professionals. For FPIs, this translates into a clearer regulatory horizon and reduced sovereign risk premium. The agreement also contains a clause on intellectual‑property protection, a crucial factor for AI‑heavy companies seeking U.S. market entry. While the framework is still provisional, its mere existence has already curbed the outflow pressure that plagued 2025.

Technical Corner: Reading FPI Flow Data and Its Predictive Power

FPI flow data is published by the NSE and NSDL on a provisional basis. Analysts watch three key metrics: net inflow/outflow volume, sector allocation percentages, and the duration of consecutive buying or selling days. A streak of four or more buying days is statistically associated with a 70 % probability of a short‑term index rally exceeding 2 %. Conversely, a reversal after such a streak often precedes a consolidation phase where earnings reports become the primary driver of price action.

Investor Playbook: Bull vs. Bear Scenarios

Bull Case: If earnings growth accelerates across the AI‑exposed tech segment and the India‑U.S. trade deal progresses to a full agreement, FPIs may extend their buying streak, pushing the Nifty into new 12‑month highs. Positioning in high‑quality large caps (Tata Motors, Infosys, Reliance) and select mid‑caps with AI exposure could generate 15‑20 % upside over the next six months.

Bear Case: Should the trade negotiations stall or earnings guidance disappoint, the recent inflow could evaporate, exposing the market to a repeat of the 2025 sell‑off dynamics. In that environment, defensive sectors like consumer staples and pharma would outperform, and a tactical shift to cash or short‑duration bonds would preserve capital.

Bottom line: The four‑day FPI buying streak is a signal, not a guarantee. Align your exposure with the twin pillars of earnings momentum and policy certainty, and you’ll be positioned to capture the upside while limiting downside risk.