FPIs Bounce Back: A February Turnaround Despite IT Stock Sell-Off

Foreign Portfolio Investors (FPIs) made a significant comeback in February, investing Rs 19,675 crore in Indian equities thanks to favorable US-India trade relations and easing global concerns. Despite heavy sell-offs previously and a notable sell-off in IT stocks recently, the stabilization of macro indicators and positive domestic and international market conditions promoted renewed investment confidence.

Foreign Portfolio Investors (FPIs) showcased a remarkable recovery in early February, channeling Rs 19,675 crore into Indian stocks. This resurgence was supported by the US-India trade accord and easing global macroeconomic tensions.

Following substantial withdrawals over the past three months, FPIs' return marked a significant inversion in investment trends. Primary reasons for past sell-offs included volatile currency movements and apprehensions over US tariffs, which led to elevated equity valuations.

Despite the drop in IT stocks amid an 'Anthropic shock', experts credit softening US inflation data and steady domestic economic indicators for invigorating investment sentiment, with a positive fiscal outlook and supportive budget further fueling investor confidence.

(With inputs from agencies.)