JPMorgan, a global financial leader, views the recent downturn in the Indian market as an attractive investment opportunity. The firm encourages investors to capitalise on the opportunity to establish or increase their stakes in India's economy.
Mixo Das, JPMorgan's Asia Equity Strategist, said the firm has been making a case to its clients that India looks extremely attractive on a structural basis. "So even when we do get periods of tactical pullbacks and uncertainty in the market, we see those as opportunities to buy, rather than opportunities to significantly trim exposure."
Das also commented on the oil market, noting the beneficial effects of falling oil prices on equity markets by easing inflation concerns. He explained the current market dynamics which is highly inflation-driven.
"It's a situation that suits equities and risk assets perfectly, with declining bond yields," he said, adding that "This means that equities and bonds have a positive correlation. So, when bond yields decrease, equities perform favourably."
On Wednesday, November 8, oil prices plummeted to their lowest point in over three months led by an increase in US crude oil inventories and mixed economic data from China, which raised concerns about the global demand for crude oil.
The international benchmark, Brent crude futures, dropped by 25 cents, settling at $81.36 per barrel, while US crude futures saw a steeper decline, falling 35 cents to reach $77.02 per barrel. These price levels marked the lowest since July 24.
US 10-year treasury yields were at around 4.492% today (November 9), coming off significantly after touching the 5% mark for the first time in 16 years.
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Das elaborated on the firm's strategy, pointing out a potential short-term rise in China's equity market, which might temporarily affect India negatively. Despite this, JPMorgan's current investment strategy favours both China and India, but "China being a more tactical overweight, whereas India being a more structural overweight."Also Read | Why Indian traders must watch the US bond yields as wellFor more details, watch the accompanying videoAlso, catch all the live updates on markets with CNBC-TV18.com's blog
(Edited by : Shweta Mungre)
First Published: Nov 9, 2023 11:11 AM IST
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