Snapping their six-month buying streak, FPIs pulled out a net Rs 13,157 crore from the Indian capital markets in the first five trading sessions of March as the coronavirus outbreak spooked investor sentiment.

According to depository data, foreign portfolio investors (FPIs) withdrew a net Rs 8,997.46 crore from equities and Rs 4,159.66 crore from the debt segment during March 2-6, taking the total net outflow to Rs 13,157.12 crore.

Before this, FPIs were net buyers in the Indian capital markets for six consecutive months since September 2019.

“The spread of coronavirus in the US is a major driving factor and India is witnessing a spillover effect of what is happening in the global markets. There has been a consistent drain of money from Indian equities as well as debt where FPIs are fleeing the Indian markets amid fear of an extended slowdown,” said Harsh Jain, co-founder and COO, Groww.

The US Fed brought in an emergency rate cut of 50 basis points, which shows that the US government is expecting a slowdown, he noted.

According to Jain, the current situation in India, along with the Yes Bank crisis, is not very encouraging.

“In the next 3-4 weeks, the coronavirus trend in the western world will dictate the investments by FPIs in India,” Jain said.

Nirali Shah, senior research analyst at Samco Securities, said “The selloff is the effect of uncertainty caused by the rippling effect of coronavirus in major economies.”