BENGALURU, July 25 Reuters Foreign investors sold nearly 1 billion worth of Indian equities in the two days since the government raised taxes on derivatives trades and on capital gains from equity investments in its annual budget.

Foreign portfolio investors FPIs net sold shares worth 81.06 billion rupees 968 million on Tuesday and Wednesday, provisional data from the National Stock Exchange showed.

These investors, anticipating the budget, had bought equities worth a net amount of 2.20 billion in six sessions before the presentation on Tuesday.

They have invested a net 5.1 billion so far this year.

The increase in capital gains tax is clearly a negative even if the increase on longterm gains is moderate, said Ashish Gupta, chief investment officer at Axis Mutual Fund.

Uncertainty over whether the longterm capital gains tax rate of 12.5 could go up further creates pressure for the market, he added.

Long term, we do not see much of an impact since the growth story remains intact and companies continue to grow.

India39;s benchmark indexes Nifty 50 and Sensex gained about 2 during the prebudget FPI buying spree.

They had risen about 3 between July 11 and July 18, but a 1 drop due to a global cyber outage on July 19 trimmed the gains.

Since the budget, the indexes have shed about 1. Sectors in which FPIs have more holdings financial services, banks and private banks  fell about 3 each.

However, domestic institutional investors have remained buyers, investing a…