FPIs withdraw Rs 2,881 crore from Indian capital markets in just 2 trading sessions in August

The Foreign Portfolio Investors (FPIs) continued their selling spree in the first two sessions of August and pulled out a net amount of Rs 2,881 crore from the Indian capital markets. The withdrawals came amid domestic and global headwinds.

The FPIs took out a net sum of Rs 2,632.58 crore from equities and Rs 248.52 crore from the debt segment between 1-2 August, as per the latest depositories data. This led to an accumulated net outflow of Rs 2,881.10 crore.

Before this the foreign investors had withdrawn a net Rs 2,985.88 crore from the Indian equity and debt markets during 1-31st July.

Also Read: Grandfathering clause to provide partial tax relief to FPIs

"FPIs withdrew more than they invested as the US-China trade war has started brewing again which is not helping investors' sentiments," Harsh Jain, COO at Groww told PTI.

Further, "the announcement of rate cuts by Fed in the US has evoked confused reactions and added to the uncertainty," he added.

FPIs were net buyers in the Indian capital markets in the first half of 2019, barring January. They infused a net ?10,384.54 crore in June, ?9,031.15 crore in May, ?16,093 crore in April, ?45,981 crore in March and ?11,182 crore in February.

Also Read: FPIs net buyers in July so far; pump in Rs 3,551 crore in Indian markets

However, the trend reversed in July after the announcement of higher tax on FPIs registered as trusts and association of persons in the Union Budget for 2019-20, experts said.

The sentiments have also been impacted by slowdown in the economy, weak quarterly earnings and sub-par monsoon, among other factors, they added.

Also Read: Super-rich tax on FPIs: FM rules out any adverse impact on investor confidence