Domestic investors bought shares worth Rs 4,120 crore on September 22, offsetting a net foreign sale of Rs 3,810 crore. The Nifty 50 index fell 0.4% during the session, ending a four-day winning streak as global concerns weighed on market sentiment.
Indian stock markets saw a sharp contrast between domestic and foreign investors on September 22. While foreign investors sold a net Rs 3,810 crore worth of stocks, domestic institutions stepped in with a net purchase of Rs 4,120 crore. This buying helped absorb the selling pressure during the trading day. The Nifty 50 index closed 0.4% lower, snapping its four-day winning streak.
The trend throughout September shows a clear divide between these two groups of investors. Domestic buying has been strong this month, with net purchases reaching Rs 43,136 crore. In comparison, foreign investors have pulled out a net Rs 11,427 crore during the same period. This indicates that Indian markets are increasingly relying on local liquidity to remain stable when foreign investors decide to reduce their exposure to emerging markets.
Several factors are currently affecting investor sentiment. Higher crude oil prices and rising US Treasury yields are making investments in emerging markets less attractive for global players. Additionally, some foreign investors have expressed concerns regarding the high valuations of Indian indices compared to regional peers. The volatility of the Indian rupee has also added to the caution among overseas participants.
On the sectoral front, energy and IT stocks faced the most pressure. The Nifty Oil & Gas index fell 0.5% following data that showed India’s core infrastructure growth in August slowed to 4.8%, which is a three-month low. Crude oil and natural gas production also saw a year-on-year decline. The IT sector also retreated by 0.8% as analysts pointed to a sustained, subdued demand environment for corporate software earnings. Despite the weakness in the broader market, new stock listings continue to show resilience, suggesting that the current foreign exit is selective rather than a complete withdrawal from India's growth narrative.