Overseas investors have started to cover their short positions in Indian equities as the market shows signs of recovery, with the Nifty index gaining 5.9% last week and closing at 24,050.6. The long-short ratio of foreign portfolio investors in Nifty futures rose to 22%, indicating a shift from bearish to more neutral positions. Nilesh Jain, head of technical and derivatives research at Centrum Finverse, noted that the recent buying in the cash market is a positive sign for potential further recovery. However, experts like Siddarth Bhamre from Asit C Mehta caution that while the ratio has improved, there are few new long positions, suggesting a continued cautious sentiment among foreign investors. The future of these investments will depend on the progress of US-Iran talks and the stability of global factors such as crude oil prices. Additionally, the upcoming fourth-quarter earnings reports will play a crucial role in determining whether foreign investors regain confidence in Indian equities.