Foreign investors become Beerarish on Indian shares in the midst of weakening rupees and rates

Mumbai: Overseas money managers are the most pessimistic about Indian shares in two years as a weakening rupee in the light of American rates, rich valuations and moderating business gains, the global luster of Dalal Street Doffen remain.

Although the risk-off sentiment about India has been imposed on the outputs to accelerate in recent weeks, their net Bearish positioning in derivatives is highest since March 2023, with the 50% rates for Indian export to the US that deepens the cautious undertone.

“Persistent foreign sale, together with short structure, reflects a clear risk-off approach because of global uncertainties and domestic headwind,” says Sudeep Shah, vice-president and head of technical and derived research, SBI securities.

‘Wrong side of rates’
Foreign Investors have shares worth almost RS 15,990 crore so far in August, after taking off RS 17,740 Crore in July. In the derivatives segment, the long -term relationship between the positions of foreigners fell to 8.28%, from 15% in the third week of July and 36.7% at the start of that month, according to SBI Securities. The long -diving ratio is a widely followed indicator for the bullish bets of traders versus the Bearish in indexfutures.

When this ratio for the Futures positions of FPIs falls, it indicates an expert’s structure by them, experts said.

“The FPI-Lange-Short Ratio in the Indexfutures gives one of the most bearish positions in recent times, with nearly 10 shorts for every long position,” said Ajit Mishra, senior vice president, research, religare make. This meter was between 10% and 20% at the end of last year and at the beginning of 2025, when the sentiment was a lot of bearish.

The Nifty and Sesex have just expanded their losing run to the sixth week in Rij-the longest saying in five years. The rupid also ended lower for a fifth week at 87.65 against the dollar.

Overseas investors, who are already uncomfortable about the rich valuations of Indian shares compared to their long-term averages and emerging market colleagues, have been in a hot-and-coul mode most of 2025. The extra rate of the Trump administration of the 25% rate on Indian goods, which means that the total levy up to 50% stomach experiences the highest on each country that they bump into other markets.

“A number of other stock markets offer better risky statements and more certainty on this point compared to Indian shares,” said Sham Chandak, head of institutional shares at Elios Financial Services. “Foreign participants in our market feel that with India on the wrong side of rates, Private Capex and in terms of consumption, consumption is likely to grow slower than before.”

Silver lining
For optimists, a low long -term ratio offers reading a silver lining.

“From a contrary perspective, such an extremely low long -diving ratio can also indicate that the market is the short -term crossing,” said Shah. “Every positive trigger such as relieving worldwide tensions or favorable domestic signals can lead to short coverage, resulting in a sharp rebound.”