Foreign Portfolio Investors (FPIs) recorded net outflows of ₹24,743.74 crore from Indian markets during the truncated trading week ending April 3, 2026, according to data compiled by the National Securities Depository Limited (NSDL). The week comprised only three trading sessions — March 30, April 1, and April 2 — with markets shut on March 31 for Mahavir Jayanti and on April 3 for Good Friday.
Equities take the biggest hit, debt sees mixed flows
Equities remained the hardest hit asset class. Across the reporting periods covering the week, FPIs recorded a combined net equity outflow of ₹23,801.94 crore through stock exchanges and the primary market route. In the debt segment, the Fully Accessible Route (FAR) saw net outflows of ₹4,309.70 crore across both reporting dates, while the Debt-VRR segment recorded marginal net inflows and the Debt-General Limit segment posted a combined net inflow of ₹1,414.79 crore. The rupee stood at ₹94.6543 to the US dollar on April 2.
March records biggest-ever monthly FPI sell-off
These weekly outflows come amid a record monthly sell-off. NSDL data shows FPIs recorded total net outflows of ₹1,25,736.40 crore from all asset classes in March 2026. Within this, combined equity outflows through stock exchanges and the primary market stood at ₹1,17,774.65 crore — the steepest monthly equity sell-off by foreign investors in Indian market history. Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, confirmed the scale, noting that…”March witnessed massive selling by FPIs to the tune of Rs 1,22,182 crore. This is the biggest ever monthly selling by FPIs.”
Global headwinds drive sustained FPI selling
The selling has been driven by a confluence of global headwinds. Dr Vijayakumar pointed to…”continuation of the war, crude again spiking to above $100 level, the steady decline in the rupee and appreciation of the dollar triggered this record selling by FPIs.” He noted that…”rupee depreciated by about 4 per cent since the war began and fears of further depreciation have added to the weakness of the rupee, which, in turn, is triggering further selling by FPIs.”
Himanshu Srivastava, Principal Manager Research at Morningstar Investment Research India, attributed the outflows to broader macro forces, noting that…”the sharp rise in geopolitical tensions in the Middle East has pushed up crude prices, revived inflation concerns, and reduced the probability of near-term rate cuts globally.” He added that elevated US bond yields had…”improved the relative attractiveness of fixed-income assets, prompting global investors to rebalance away from equities.” He also flagged that…”the Indian rupee remaining under pressure, thereby impacting dollar-adjusted returns for FIIs” had compounded the selling.
Domestic investors cushion market impact
For calendar year 2026 as a whole, FPIs have now recorded cumulative net outflows of ₹1,17,172.20 crore across all asset classes, with equity outflows alone reaching ₹1,31,121.53 crore, partially offset by net inflows in the FAR and Debt-General Limit segments.
Domestic Institutional Investors have provided a buffer. Pabitro Mukherjee, Associate Vice President – Technical Research at Bajaj Broking, noted that…”corresponding to the FII outflows of ₹1.11 lakh crore, the domestic buyers have supported with record buying of ₹1.28 lakh crore giving some support to the markets.”
RBI steps in to stabilise rupee
On the currency front, the Reserve Bank of India stepped in to arrest the rupee’s slide. Dr Vijayakumar noted that RBI’s directive capping daily rupee positions of banks and requiring short positions to be covered before April 10…”triggered a short-squeeze which enabled the rupee to rise to 93.20 to the dollar from the 95.30 level on March 30th.” He cautioned, however, that…”so long as crude price remains elevated, rupee will continue to be fundamentally weak,” and that…”FPI inflows can happen only when there is de-escalation on the war front, leading to decline in crude.”