The Indian equity market is breathing easy again, fueled by a resurgence in foreign institutional investor (FII) buying after a cautious phase. In nine straight sessions, FIIs have invested over $2 billion, driving sharp gains across major indices and restoring optimism among traders.
Exchange figures show FIIs net bought Rs 2,223 crore worth of stocks on February 9. Experts remain measured, suggesting longevity depends on steady global cues, better company profits, and dollar softening. Meanwhile, domestic institutional investors (DIIs) stole the show, netting Rs 8,973 crore in purchases over the period.
This domestic firepower has flipped the script: DIIs now outnumber FIIs in Nifty 50 ownership. Mutual fund SIPs, retail investor enthusiasm, and steady pension fund inflows are powering this change. Foreign caution stemmed from worldwide economic jitters and higher US rates.
“Domestic investment offers enduring support, minimizing global volatility impacts and fortifying the market,” says Himanshu Shrivastava of Morningstar Investment Research India. Post-dip valuations look compelling versus Asian rivals, and positive India-US trade talks add to the appeal.
The rally saw Sensex and Nifty climb above 3%, with BSE Midcap 150 up 5.66% and Smallcap 250 soaring 6.3%. RBI’s soft policy, economic rebound, earnings promise, and homegrown capital are luring FIIs back. Per Motilal Oswal, DIIs hold 24.8% of Nifty 50 as of Dec 2025 quarter, surpassing FIIs’ 24.3%—a structural shift towards market maturity.