Foreign investors have pulled out a massive $4 billion (over Rs 26,700 crore) from capital markets (equity and debt) so far this month, primarily due to surge in global crude prices. In April, they had pulled out more than Rs 15,500 crore, which was the steepest outflow in 16 months.

According to the latest depository data, foreign portfolio investors (FPIs) withdrew Rs 7,819 crore from equities and another Rs 18,950 crore from the debt market during May 2-25, taking the total outflows to Rs 26,769 crore ($4 billion).

Harsh Jain, chief operating officer at Groww, an investment platform, attributed the latest outflow mainly to rise in the cost of crude oil prices. This would impact all oil importing economies, including India, and adversely affect its current account deficit, fiscal deficit, imported inflation and create headwinds for economic growth.

Besides, investors were cautious after US President Donald Trump cancelled a planned meeting with North Korean leader Kim Jong Un and threatened to impose tariffs on auto imports.

Also, FPIs had started profit booking before the Karnataka elections, which was a crucial indicator for the 2019 big elections results, he added.

“Another discomfort among the FPI (Category III) was SEBI’s requirement for additional documents from key people in such a fund. Their concern is around the privacy and data theft,” Jain noted.

So far this year, FPIs have put in just Rs 641 crore in equities and withdrew nearly Rs 30,000 crore from the debt market.