New Delhi, Feb. 4 -- New Delhi: Foreign portfolio investors (FPIs), who have been betting against Indian markets since October 2024, were forced to cover nearly two-fifths of their bearish derivatives positions on Tuesday after the announcement of an India-US trade deal.

Analysts expect the short covering to continue in the near term. But a full exit from bearish bets, and a shift to positive positioning, is unlikely until the specifics of the deal are known. Broader geopolitical risks, including tensions with Iran and concerns around an artificial intelligence (AI) bubble, could also weigh on sentiment, they added.

FPIs cut their cumulative net bearish positions in futures and options on the Nifty and Bank Nifty by 39% to 542,299 contr...