Goldman Sachs stated that the large-scale sell-off by foreign investors is likely over, but the strength of their subsequent return to buying may remain limited. Foreign Portfolio Investors (FPI) in India have cumulatively sold local stocks worth $22.17 billion, a figure that has already surpassed the historical peak outflow record set in 2025. Goldman Sachs noted that the historical correlation between declining oil prices and the return of foreign capital has significantly weakened. Simultaneously, rising input costs are casting uncertainty over the prospects for corporate earnings recovery. The firm reported that in the first quarter of this year, the proportion of foreign holdings in the Indian stock market fell to a 14-year low. For the first time in over two decades, this level dropped below the proportion held by domestic institutional investors in India. The bank anticipates that when market sentiment improves, stocks with low foreign ownership and those under-owned by funds may outperform the broader market. It reiterated its optimistic outlook on the financial sector and the consumer staples sector.