New Delhi, Jan. 30 -- With the Union budget for FY27 just about there, trading patterns in the derivatives market suggest that foreign investors are bracing for either a correction or a long spell of post-budget calm. Foreign portfolio investors (FPIs), who have prevailed over bullish retail investors by shorting the Indian markets since October 2024, are running into the budget in an extreme bearish mode for the second straight year.

Analysts said their positioning reflected expectations of either a market correction or a fall in volatility-flat markets-post the event. In either of these cases, the option premiums paid by the buyers would shrink, allowing the FPIs to pocket them. However, a market-friendly budget could result in massive...