Foreign portfolio investors (FPIs) have pulled out Rs 17,696 crore from the Indian markets in December so far amid uncertainty due to a new coronavirus strain, Omicron, and expectations of faster tapering by the US Federal Reserve.

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According to the depositories data, FPIs took out Rs 13,470 crore from equities, Rs 4,066 crore from the debt segment and Rs 160 crore from hybrid instruments between December 1-17.

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In November, FPIs were net sellers to the tune of Rs 2,521 crore in Indian markets.

There continues to be uncertainties on the global as well as domestic fronts, said Himanshu Srivastava, Associate Director - Manager Research, Morningstar India.

The concerns over the highly transmissible Omicron variant of coronavirus persist and have impacted global growth outlook, he added.

"Also, the economic growth has also been relatively slow, and India's earnings have not grown much," he added.

If the situation worsens, it could further prompt them to redeem investments from emerging markets like India which are considered to be more prone to turmoil in the global markets.

"Since banking constitutes the largest FPI holding, it is bearing the brunt of FPI selling," V K Vijayakumar, Chief investment Strategist at Geojit Financial Services said.

Sustained FPI selling has made the high quality banking stocks attractive from the valuation perspective, he added.

With respect to other emerging markets, Shrikant Chouhan, Head - Equity Research (Retail), Kotak Securities said South Korea, the Philippines, Taiwan, Thailand and Indonesia, witnessed inflows of USD 1,870 million, USD 1,707 million, USD 297 million, USD 94 million and USD 57 million, respectively.

"FPI flows are expected to remain volatile given key events such as upcoming state elections and monetary tightening by developed countries," he added.