Indian Stocks Track Toward Longest Weekly Losing Streak in 25 Years as Foreign Investors Pull Record $27.8 Billion

With the 10-year Treasury yield sitting above 5.3% and US debt now past $40 trillion, foreign money keeps finding its way out of Indian equities and into higher-yielding dollar assets. Thursday's trading session showed just how steady that drain has become.

India's Nifty 50 opened Thursday down 0.28% at 22,558.95 and the Sensex slipped 0.12% to 72,389.51 as of 9:44 a.m. IST, according to Reuters. By early afternoon the selling had intensified. The Week India reported the Sensex plunged more than 950 points from Wednesday's close to hit an intraday low of 71,527.28, while the Nifty shed nearly 320 points to touch 22,301.30.

Zoom out to the past week and the damage is steeper still. Since last Friday's close, the Sensex has given up more than 2,360 points and the Nifty has dropped almost 840 points, The Week India reported.

Record Foreign Outflows

Foreign Institutional Investors sold ₹10,148 crore, or $1.06 billion, in Indian shares on Wednesday alone, provisional data showed. That brings their selling over the past five sessions to roughly $3.6 billion and pushes 2026 year-to-date outflows to a record $27.8 billion, according to Reuters.

Hariselvan Radhakrishnan, founder and CEO of HST Wealth, said traders are positioning cautiously with Indian markets closed Friday for a local holiday. "Foreign outflows and elevated borrowing costs continue to weigh on sentiment even if a drop in crude offers some relief after the recent surge in energy prices," he told Reuters.

Eighth Straight Weekly Loss, But Not the Worst One

If the index closes lower this week, it will mark the eighth consecutive weekly decline for the Nifty 50, the longest losing streak since 2001, when the index fell for nine straight weeks, according to data cited by Inkl. The Nifty's longest losing run on record was 10 straight weeks ending April 23, 1993, when it dropped 22.9%.

The current slide is notably milder than those historical comparisons. The Nifty's seven-week decline through September 25 totaled 5.8%, Inkl reported. That compares with a 20.5% drop over seven weeks ending September 21, 2001, a 22.1% drop ending July 4, 2008, and a 33.3% collapse ending April 3, 2020, during the pandemic crash. The streak is real, but the magnitude of losses remains modest compared to past crises.

Sector Winners and Losers

Eleven of 16 major sectors declined Thursday, with small-caps down 0.6% and mid-caps down 0.3%, Reuters reported. The auto index took the hardest hit, falling 2.4%. Bajaj Auto dropped 6% and Mahindra & Mahindra lost 2.4% after both companies reported declining domestic sales.

Not every sector bled. The IT index gained 0.9% after data showed US inflation in August rose less than expected, lowering the odds of a Federal Reserve rate hike later this month. Kotak Mahindra Bank jumped 3% after naming Anup Kumar Saha as its new CEO for a three-year term, succeeding Ashok Vaswani.

Crude Relief, With a Catch

Brent crude futures slipped to around $97 a barrel after Tehran said it had received Washington's response to its latest ceasefire proposal, Reuters reported. That is a notable wrinkle given President Trump said just days earlier that he had rejected Iran's proposal outright. Neither government has publicly reconciled those two statements, leaving the actual state of US-Iran ceasefire talks an open question even as oil traders treated the news as a de-escalation signal.

What's Unresolved

When US Treasury yields sit above 5.3% and Washington is running $40 trillion in debt, dollar-denominated assets become a safer, better-paying bet than emerging-market equities, and foreign capital will chase that yield. Whether the Nifty 50 and Sensex actually close out an eighth losing week now hinges on Thursday's final numbers, since Indian markets are shut Friday for the holiday. As of Thursday afternoon, foreign investors were still selling and the streak remained intact.