Foreign investors post longest buying streak in 2 years: Here's what their top sector picks reveal

Indian equities have been facing volatility, while foreign portfolio investors (FPIs) have remained a key source of selling pressure. But that trend may finally be showing signs of a reversal.

In a post on X, Capitalmind Mutual Fund mentioned that “FPIs have started buying Indian stocks again”. The fund house noted that FPIs have invested ₹63,941 crore in Indian equities over the past five fortnights, marking the longest stretch of fortnightly buying in the last 2 years.

For retail investors, the shift is worth watching. FPI flows do not determine market direction on their own. But where global investors are putting money can offer clues about the sectors attracting foreign capital and those they are moving away from.

How have FPI flows into Indian equities changed?

The fund house noted that FPIs have returned to buying after seven consecutive fortnights of selling.

In NSDL’s FPI data, a fortnight refers to the periods from the 1st to the 15th and from the 16th to the end of the month. NSDL publishes data twice a month, providing updates on foreign portfolio investment flows in India.

Data from March to August 2026 shows a sharp reversal in FPI equity net investment flows.

FPIs sold about ₹53,000 crore during March 1-15 and another ₹65,000 crore during March 16-31. Selling continued over the following fortnights, with FPIs cumulatively offloading about ₹2.75 lakh crore over seven fortnights from March 1 to June 15.

The trend turned positive in June, with FPIs investing around ₹14,000 crore during June 16-30. From August 16-31, FPIs bought equity worth around ₹13,000 crore.

Where are FPIs putting their money now?

The buying between June 16 and August 31, 2026 has not been broad-based. The fund house noted that five sectors accounted for 81% of FPI inflows over the last five fortnights, highlighting a clear preference for specific parts of the market.

Financial Services attracted the highest inflows at ₹24,434 crore, followed by consumer services at ₹21,699 crore. Healthcare received ₹15,121 crore, while consumer durables attracted ₹13,809 crore. Services also saw strong buying of ₹26,779 crore.

This suggests that foreign investors have been favouring financials, consumption-linked businesses and healthcare rather than buying across the market indiscriminately.

Which sectors are FPIs selling?

At the other end, FPIs continued to reduce exposure to several sectors.

Between June 16 and August 31, 2026, telecommunications saw the highest outflows at ₹11,428 crore. This was followed by power at ₹8,159 crore and capital goods at ₹7,111 crore.

FPIs also sold ₹4,805 crore of oil, gas and fuel stocks and ₹3,018 crore of FMCG stocks.

Is this a new FPI trend?

Not necessarily—at least not yet.

“Still, ₹63,941 crore over five fortnights is far below the ₹2.75 lakh crore FPIs sold in the seven fortnights before this. So it's too early to call this a trend. We will have to see if this buying continues,” the fund house mentioned.

The recent buying is a positive signal, but it does not yet indicate a decisive shift in foreign investor sentiment.

For retail investors, the key takeaway is not to blindly follow FPI flows, but to use them as one additional signal when assessing market sentiment, sector preferences and where global capital is currently finding opportunities in India.

Disclaimer: This is purely for educational/informational purposes and should not be taken as any sort of investment advice. Always consult a SEBI-registered advisor before making any investment decisions.