Dalal Street Ends Flat Amid Expiry Volatility; FIIs Remain Net Buyers While DIIs Trim Stakes

Market Snapshot

The Indian equity markets witnessed a volatile session on February 26, 2026, ultimately ending on a sideways note. While the Nifty 50 managed to eke out marginal gains, the Sensex closed slightly in the red, dragged down by profit-booking in select financial and FMCG heavyweights. The market sentiment was influenced by the monthly Sensex F&O expiry and mixed global cues, including Nvidia's stellar earnings and ongoing geopolitical negotiations.

• Nifty 50: 25,496.55 (+14.05 pts | +0.06%)
• S&P BSE Sensex: 82,248.61 (-27.46 pts | -0.03%)
• India VIX: 13.06 (-3.15%)
• Market Breadth: Positive (2,170 shares advanced vs 2,034 declined on BSE)

Institutional Flows: Cash Market

Provisional data for the day showed a divergence in institutional activity. Foreign Institutional Investors (FIIs) remained net buyers for the fourth consecutive session, signaling continued confidence in large-cap valuations. Conversely, Domestic Institutional Investors (DIIs) broke their recent buying streak to turn marginal net sellers.

• FII Net Position: +₹2,251.37 Crore
• DII Net Position: -₹601.03 Crore
• FII Gross Buy/Sell: ₹30,492.98 Cr / ₹28,241.61 Cr
• DII Gross Buy/Sell: ₹18,590.13 Cr / ₹19,191.16 Cr

Derivatives Market Activity

Derivatives data indicated a cautious approach by institutional participants ahead of the upcoming weekly expiries. FIIs were seen reducing their long exposure in index futures while increasing short positions as a hedge against global uncertainty.

• Put-Call Ratio (PCR): The Nifty PCR stood at 0.88, down from 0.91, suggesting a slight increase in bearish bets or hedging activity.
• F&O Ban List: No stocks were in the F&O ban for the day, reflecting stable systemic liquidity.
• Options Sentiment: Highest Open Interest (OI) was concentrated at the 25,600 Call and 25,500 Put strikes for the March 2 expiry.

Key Drivers and Outlook

The market was primarily driven by a "buy-on-dips" strategy in defensive sectors like Pharma and IT, the latter buoyed by Nvidia’s robust fourth-quarter results. However, the lack of follow-through buying in the banking sector prevented a broader rally.

• Global Cues: Markets tracked the indirect US-Iran negotiations in Geneva involving US Special Envoy Steve Witkoff and Jared Kushner, which kept energy-sensitive sectors on edge.
• Sectoral Performance: Nifty Pharma (+1.08%) and Nifty IT (+0.89%) were the top performers. Nifty Media and FMCG were the primary laggards.
• Corporate Action: The retail portion of IRFC’s Offer for Sale (OFS) opened today; however, the government decided to skip the greenshoe option following a muted institutional response on Wednesday.
• Regulatory Updates: SEBI issued a new mandate requiring market intermediaries to disclose their registration details on social media platforms by May 1, 2026, to curb unauthorized financial advice.

Looking ahead, the technical setup for Nifty remains constructive as long as it holds the 25,300–25,350 support zone. Resistance is firmly placed at 25,700–25,800. Investors will be closely watching the upcoming US-Iran developments and domestic auto sales data for March for further direction.

TAGS: FII, DII, Stock Market, Institutional Investors, Nifty, Sensex

Tags: FII DII Stock Market Institutional Investors Nifty Sensex