The average daily trading volume in the cash segment on NSE dipped 4 per cent in September to six month low at ₹1.15 lakh crore against ₹1.20 lakh crore logged in August on the back of bearish sentiment amid consistent selling by foreign investors.
However, turnover on BSE was up 5 per cent last month at ₹11,081 crore against ₹10,590 crore in August.
Both the benchmark indices Nifty and Sensex dipped 6 per cent each due to global turmoil. This is the second consecutive month of negative closing for the key indices. Foreign portfolio investors have pulled out $2.7 billion last month, taking the overall net outflow from India to $26.8 billion in 2026.
The FPI selling was largely in the large cap stocks putting further pressure on the key indices. The sharp rise in the US bond marked forced many global investors shift their investment in Indian equities to the US bond markets.
The growth prospects of Indian economy was also threatened by steady rise in crude oil prices. India Inc may face pressure on margins in coming days with the sharp increase in input costs.
Dr VK Vijayakumar, Chief Investment Strategist, Geojit Investments said the market has been steadily trending down for the last two month on elevated crude prices and high US bond yields impacted the market.
“The uncertainty introduced by the new CAS settlement system also impacted the volumes. Under the new CAS intra-day trading has become exceedingly risky. This has significantly impacted daily trading volume,” he added.
Shrey Jain, CEO, InCred Money Broking said trading activity usually follows returns, and September was one of the weakest months for Indian equities this year. For the first time since the Covid crash, the Nifty 50’s two-year returns have turned negative.
Having said that, domestic money has not left equities, but was routed through domestic institutions led by mutual funds which bought a net ₹76,000 crore in September, he added.
Sachin Gupta, VP – Research, Choice Broking said retail investors and traders are increasingly looking for clarity before committing fresh money, rather than buying aggressively during uncertain market conditions.
With benchmark indices struggling to stage a meaningful recovery, many participants appear more focused on protecting their capital than chasing short-term opportunities.
Some investors are also choosing mutual funds and SIPs to participate in the equity market without having to select individual stocks themselves, he added.
Vishal Trehan, Head India Sales and COO – Broking and clearing, Aikyam Capital Group said the fall of 6 per cent in Nifty has prompted investors to moderate trading activity, though it presents an opportunity for evolving investment preferences and alternative avenues for equity participation.
Specialised Investment Funds (SIFs) are emerging as an additional option for eligible investors, offering differentiated strategies beyond conventional equity investing, he said.