Indian Markets Plunge: FIIs Most Bearish Ever, Is a Bottom Near?

• Indian equity markets experienced a brutal week, with Nifty 50 and Sensex falling for five consecutive sessions, erasing Rs 13.49 lakh crore in investor wealth.
• Foreign Institutional Investors (FIIs) sold equities worth Rs 9,209.90 crore, reaching their highest net short position in index futures on record.
• The market turmoil was exacerbated by reports of a potential 500 percent US tariff on India unless it stops importing oil from Russia.
• Technically, Nifty failed to hold above 26,300, forming a bearish engulfing pattern, with further downside potential towards 25,300 and 25,168.
• While short-term pain persists, extreme bearish sentiment across indicators suggests contrarian buy signals for the medium-term, hinting at an attractive risk-reward.

Why It Matters: Indian markets face short-term pressure due to FII selling and tariff threats, but extreme bearishness hints at a medium-term opportunity.