India Sees First Weekly Inflow in Nearly Two Months, Signals Easing Investor Pressure

New Delhi — India recorded a net inflow of $106 million in the latest week, marking the first positive weekly movement in seven weeks, according to a report by Elara Capital.

The inflow follows nearly $5 billion in cumulative outflows over the previous six weeks, suggesting that the intense selling pressure from India-focused funds may be starting to ease. Weekly outflows have also dropped sharply—from a peak of $1.2 billion to around $180 million—indicating improving investor sentiment.

A major contributor to the turnaround was exchange-traded funds (ETFs), which attracted $220 million during the week. However, long-only funds continued to face pressure, recording outflows of approximately $400 million.

In a notable shift, US-domiciled funds—previously a key driver of selling—posted inflows of $225 million after seven straight weeks of withdrawals totaling $3.3 billion.

Despite these positive signs, India-focused investment strategies have still seen outflows for nine consecutive weeks, highlighting that a full recovery in flows is yet to materialize.

Globally, liquidity conditions remained supportive for the fourth straight week, with consistent inflows across major fund categories. US equity funds attracted between $10 billion and $22 billion weekly over the past month, while global funds brought in around $16 billion.

Emerging market funds also maintained steady momentum, with Global Emerging Market (GEM) funds drawing up to $2 billion weekly and emerging market growth funds adding $1.4 billion.

On the other hand, Europe and China continued to experience outflows over the past five weeks, reflecting contrasting regional investment trends.

Commodity-related equity funds saw a slowdown in inflows after strong gains during heightened geopolitical tensions. Energy funds recorded reduced outflows, gold inflows stabilized at a slower pace, and silver-related investments remained weak.

With inputs from IANS