While many market watchers are of the opinion that the worst may be over the global markets, Credit Suisse's Dan Fineman believes that the turbulence is likely to continue as the US Federal Reserve, the defacto benchmark central bank, is likely to hold the high-interest rates for longer than expected.
In an interview with CNBC-TV18, Dan Fineman, the Co-Head of Equity Strategy-Asia Pacific at Credit Suisse, reasons that the second phase of inflation cool-off will take time.
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“For inflation in the US, the real difficulty comes as you get closer to the Fed’s target range. It is much easier to bring inflation down from 8 percent to 4 percent than from 4 percent to 2 percent. And that is when we think that markets will get tripped up later in the year,” he said.
India vs China as an investment opportunity
Fineman and his team at Credit Suisse are still maintaining a cautious view of the global markets. One major focus area for Fineman is the comparison between China and India. The market watcher believes that China currently has an edge over India in terms of valuations.
"India is still relatively expensive when compared to its historical averages. This could present a potential risk for investors in the Indian market," he reasoned.
Also Read | This Credit Suisse analyst thinks China is a bright spot despite COVID surge — here’s why
Fineman's comments reflect a general sense of uncertainty in the global markets. While there may be potential for growth, there are also a few potential risks that investors should be aware of.
The Indian equity benchmarks BSE Sensex and NSE Nifty 50 opened flat on the last trading day of the week despite largely positive cues from global markets.
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