On August 27, it was domestic money that stopped Indian equities from sliding any further. Even as FIIs resumed their role as sellers, DIIs bought up close to Rs 5,000 crore. The benchmarks did not get the lift they might have wanted though, with the Sensex and Nifty finishing at a one-week low. One could say the week has been a case of who is really calling the shots.
DIIs counter FII selling as indices slide
Provisional exchange figures show that after a three-day run of foreign buying, FIIs were net sellers on Thursday to the tune of Rs 298.26 crore. DIIs made up for it with a robust Rs 4,977.17 crore in net purchases per NSE data, which helped sentiment if it did nothing to put a stop to the downtrend.
All told, the two groups were net buyers of Rs 4,678.91 crore. In the session, foreign desks put in Rs 15,276.94 crore in buys and took out Rs 15,575.20 crore. Domestic institutions were on the other end of the ledger, purchasing Rs 19,605.60 crore and offloading Rs 14,628.43 crore.
A quick look at the key flow prints from the session:
– FIIs net sell: Rs 298.26 crore
– DIIs net buy: Rs 4,977.17 crore
– Combined net buying: Rs 4,678.91 crore
– FII gross buys/sells: Rs 15,276.94/15,575.20 crore
– DII gross buys/sells: Rs 19,605.60/14,628.43 crore
Flows show shifting power in August
Foreign flows have been more amenable to India this month, yet they do little to offset the year’s outflow. So far in August, FII net inflows are in the region of Rs 8,961 crore. DIIs have put in nearly Rs 65,990 crore over the same time.
The numbers for 2026 put cumulative FII outflows at some Rs 3.37 lakh crore year-to-date, against domestic institutional purchases of almost Rs 5.09 lakh crore. The report makes plain that the foreign capital coming in this month is only about 2.5% of what has left, leaving DIIs firmly in the driver’s seat.
Market breadth weak despite domestic support
No amount of institutional backing could turn the tape. The Sensex gave up 539 points to 76,933 and the Nifty was down 117 to 24,091. The Nifty Bank was no better, losing 274 points to 57,510, and the Midcap index eased 66 to 64,035.
There was an uptick in volatility; the Nifty 50 was down 0.5% and the India VIX climbed close to 4%. Elsewhere, the broader market fared relatively well with the Nifty Midcap 100 and Smallcap 100 lower by 0.1% and 0.2% respectively. On the sectoral front, Pharmaceuticals (+0.8%) and Consumer Durables (+0.7%) did well, while Cement and PSU Banks were laggards at -1.3% and -1%.
Stock moves reveal pain points and pockets of strength
HDFC Bank was a drag on both the Nifty and Nifty Bank, hitting a four-year low and weighing on the mood. Hindalco was the worst performer on the Nifty as softer metal prices took their toll.
The auto space was generally soft, Mahindra & Mahindra among those in decline. Shriram Finance was down 1.5% and Bharti Airtel fell 1% in the wake of some remarks from Singtel regarding its stake.
Not all was negative. Adani Enterprises put on 2% on the back of a good note from a broker. Kotak Mahindra Bank built on Wednesday’s gains for a 5% weekly rise. BHEL and CG Power both saw advances of over 4%, the former on volume and the latter as electrical-equipment stocks firmed.
Then there were Muthoot and Manappuram Finance, which shed 4-5%. Container Corporation of India was hit by a late selloff and dropped over 4%, and Tata Power was down 3% following an unfavourable arbitration ruling. Jewellery names were up on talk of a customs-duty cut.
Global cues and what to watch next
One cannot ignore the headwind from the global risk tone. US equities closed lower and Asia was soft. While progress on an interim deal to get shipping moving through the Strait of Hormuz has calmed some supply fears, with Brent at $86/bbl, it has done nothing for Indian equities.
Nvidia’s Q2 numbers and revenue outlook have been good for tech sentiment, underlining the trend in AI spending worldwide. Siddhartha Khemka of Motilal Oswal Financial Services sees it as positive for technology stocks globally, but says the effect on Indian IT will be more of a nuance, with the focus being on AI hardware and infrastructure.
The market’s eye is on the July IIP data coming Friday for some indication of industrial momentum. A strong showing would be welcome for Capital Goods and Industrials, according to Khemka, whereas a poor one would only fuel growth worries. For the moment, weak global signals and some selective selling have the market range-bound, with crude providing the only real cushion.
