Foreign investors (FPIs) continue to sell in the Indian stock market, seeing a huge decline in the market. The trend continued in February 2025, where foreign portfolio investors (FPI) sold shares worth Rs 34,574 crore. So far this year, shares worth Rs 1,12,061 crore have been sold, which has increased the market volatility.

Impact of FII selling: worst day in February

On Friday, foreign institutional investors (FIIs) sold shares worth Rs 11,639 crore, which was the worst trading day of February.
In February, out of 20 business days, only 2 days of purchases were seen, the selling dominated the rest of the day.
On February 18, FPI sold shares worth Rs 4,786.60 crore and on February 4, Rs 809.20 crore.
In January, FII sold shares worth Rs 78,027 crore.

Why are foreign investors selling?

According to stock market experts, there are many major reasons behind foreign investors withdrawing money from the market:

High valuation of the Indian market – The value of the Indian stock market currently remains high, causing FPI to see profit booking.
Weak results of companies Q3 (October-December)-the third quarter economic results have been below the average, making investors feel uncertain.
Global Uncertainty-US-China trade war and trump administration policies have affected global markets.
Foreign investors are investing their money for higher returns due to increase in interest rates in the US.

There was tremendous selling in October-November 2024

In December 2024, foreign investors bought shares worth Rs 15,446 crore, but earlier in October and November they sold tremendously.
A total of Rs 1,15,629 crore shares were sold in these two months.
In the entire 2024, foreign investors bought shares worth only Rs 427 crore, which was extremely low compared to previous years.

Nifty witnessed the biggest decline after Kovid in February 2025

The Nifty fell 5.9% in February, the biggest monthly decline after Kovid.
The IT, Auto and Pharma sector recorded the biggest decline due to the Trump administration’s threat to increase tariffs.
Heavy selling of foreign investors also led to weakness in the rupee, which puts more pressure on the market.

What for investors next?

Long -term investors do not need to panic – market instability will remain, but the decline may also be an opportunity to invest in good stocks.
SIP and mutual fund investors should be patient – continue investing in SIP despite the market fall.
Foreign investors may continue selling – as long as global uncertainty remains, there will be a possibility of selling from foreign investors.
Long -term prospects of the Indian market strong – India’s economy can perform well in medium and long term due to strong fundamentals of India’s economy.