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DIIs Inject ₹27K Cr to Counter FII Exodus, Cushion Market Fall

Domestic institutional investors provided a critical buffer last week, purchasing a net ₹26,897 crore to absorb selling pressure from foreign institutional investors, who offloaded ₹24,596 crore. This persistent FII selling has pushed March's month-to-date outflows past ₹1.13 lakh crore, the sharpest single-month sell-off this fiscal year, driven by global uncertainty and geopolitical tensions. Consequently, Indian equity benchmarks closed lower for the fifth consecutive week, with the Nifty falling 1.28% and the Sensex dropping 1.27%. Analysts note the near-term outlook remains cautious, expecting range-bound action until global risk sentiment improves, though robust domestic flows should help limit the downside.

Key Points: DIIs Counter FII Outflows, Inject ₹27K Cr to Support Market

  • DIIs net buyers of ₹26,897 crore
  • FIIs net sellers of ₹24,596 crore
  • March FII outflow exceeds ₹1.13 lakh crore
  • Nifty fell 1.28% for the week
2 min read

Domestic investors cushion the fall amid persistent foreign outflows

Domestic investors bought ₹26,897 crore last week, absorbing FII selling of ₹24,596 crore and providing crucial market support amid global uncertainty.

"DIIs countered strongly with Rs 25,000+ crore of net buying weekly, cushioning the fall. - Vinit Bolinjkar"

New Delhi, March 29

Amid the persistent foreign outflows, domestic institutional investors continue to provide strong support, emerging as net buyers to the tune of Rs 26,897 crore last week, effectively absorbing the selling pressure from FIIs.

This continued domestic participation helped cushion the downside and provided stability near key support zones, said analysts.

"Foreign institutional investors (FIIs) remained consistent net sellers throughout the week, with cumulative outflows of approximately Rs 24,596 crore, driven by global uncertainty, rising bond yields, and a stronger US dollar," said Ponmudi R, CEO, Enrich Money, a SEBI-registered online trading and wealthtech firm.

Despite DII dominance over FII outflows, overall market sentiment remains weak, clearly reflecting the impact of broader global and macroeconomic headwinds, he mentioned.

As of March 27, FIIs extended their aggressive selling in Indian equities.. This pushed March MTD (month-to-date) outflows past Rs 1.13 lakh crore - the sharpest single-month sell-off in FY26 - driven by West Asia tensions and elevated oil prices.

"DIIs countered strongly with Rs 25,000+ crore of net buying weekly, cushioning the fall," said Vinit Bolinjkar, Head of Research-Ventura

Near-term outlook stays cautious and "we expect range-bound action and elevated VIX until global risk sentiment eases", he mentioned.

"Yet robust domestic flows and any de-escalation in geopolitics should limit downside, favouring quality large-caps and domestic themes over high-beta plays," said Bolinjkar.

Meanwhile, the Indian equity benchmarks closed lower for the fifth consecutive week, amid persistent geopolitical tensions, elevated crude oil prices and sustained foreign outflows.

Nifty dipped 1.28 per cent during the week and declined 2.09 per cent on the last trading day to settle at 22,819. At close, Sensex was down 1,690 points or 2.25 per cent, at 73,583. It declined 1.27 per cent during the week.

Both indices remained volatile and under pressure throughout the week, although they attempted intermittent recoveries during the week.

- IANS

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Reader Comments

P
Priya S
While it's good that DIIs are providing support, we should be concerned about the underlying weakness. A market propped up by domestic buying while foreigners flee isn't exactly a sign of robust health. The geopolitical tensions and oil prices are a real worry for household budgets too.
R
Rohit P
Sensex down 1700 points in a day is still scary, cushion or no cushion. My SIPs are taking a hit this month. Hope the analysts are right about the downside being limited. Time to maybe add some more to my large-cap fund.
S
Sarah B
Interesting to see this dynamic. In many other emerging markets, such large FII outflows would cause a crash. The depth of India's domestic capital pool is really impressive. It shows growing financial maturity.
K
Karthik V
Mutual funds and insurance companies are doing the heavy lifting. This is why every uncle and aunty should keep investing through SIPs regularly. Volatility is part of the game. Jai ho to the Indian investor!
V
Vikram M
The headline number of Rs 1.13 lakh crore outflow is alarming, no doubt. But context matters. Our market cap is huge now. This is a correction we had to have after the rally. Stay invested in quality companies, not tips from WhatsApp groups.

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