Indian markets ended fiscal year 2026 lower after retreating from earlier highs, despite substantial domestic investment.
Indian Markets End FY26 Lower
Indian equity benchmarks ended FY26 lower, unable to hold earlier gains. The Sensex, after reaching a life-peak of 86,159 points on December 1, closed the fiscal year at 71,948, down 5.4%. The Nifty 50 hit a high of 26,373 points on January 5 but finished FY26 at 22,331, down 3.6%. Investor wealth, measured by BSE's market capitalization, remained flat at ₹412 lakh crore.
Foreign Investors Sell Record ₹1.8 Lakh Crore
A key trend in FY26 was the record exodus of foreign capital from Indian equities. Foreign institutional investors (FIIs) sold shares heavily, with total net outflows reaching ₹1.8 lakh crore. This was the largest annual outflow on record from NSDL, signaling investor caution amid global uncertainties and domestic adjustments.
Domestic Funds Pump ₹8.3 Lakh Crore Amid IPO Surge
Domestic institutional investors (DIIs) provided a strong counter-balance, injecting substantial capital into the market. DIIs, including mutual funds, recorded net buying of ₹8.3 lakh crore, with mutual funds contributing ₹5.1 lakh crore. This domestic demand cushioned the impact of heavy foreign selling. The year saw a record ₹2 lakh crore raised through Initial Public Offerings (IPOs), showing strong investor demand for new listings. Four IPOs each raised over ₹10,000 crore, led by the ₹15,111-crore Tata Capital offer.
Gold and Silver Deliver Massive Gains
Gold and silver were the top wealth creators in FY26. Silver prices more than doubled, reaching ₹2.3 lakh per kilogram. Gold gained 47%, closing near ₹1.5 lakh per 10 grams. This performance signals a shift towards safe-haven assets amid market volatility.