New Delhi: Foreign investors pulled out a net amount of ₹5,920 crore from the Indian capital markets in August even as the government rolled back enhanced surcharge on FPIs last week.

The withdrawal from the capital markets (both equity and debt) in August is "contrary to the expectation" since the Centre last week announced revocation of enhanced super-rich tax on foreign and domestic equity investors imposed in the Budget, said Himanshu Srivastava, senior analyst manager research at Morningstar.

According to the latest depositories data, foreign portfolio investors (FPIs) withdrew a net amount of ₹17,592.28 crore from equities and pumped in a net sum of ₹11,672.26 crore in the debt segment, translating into a total net outflow of ₹5,920.02 crore during August 1-30.

In July, overseas investors had pulled out a net amount of ₹2,985.88 crore from the capital markets.

Prior to the announcement of enhanced super-rich tax in the Union Budget for 2019-20 in July, FPIs were net buyers for five consecutive months.

FPIs had 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 into the Indian capital markets.

"Concerns over slowing domestic economy, volatility in the global markets and increased fears of global recession due to escalating trade war tension between US and China overshadowed the positive move of withdrawal of surcharge," Srivastava added.

This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.

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