Fund managers’ investment in Chinese equities continues to rise at the expense of India. – ..
Mumbai: In view of the incentives announced by China to revive the economy, global fund managers are increasing their allocation to China at the expense of India, according to a survey by BofA Securities. Currently, funds are expecting good returns from investments in China at low valuations.
The Chinese government announced last week that the government will significantly increase the issuance of debt instruments in an effort to boost sluggish economic growth, the largest monetary stimulus since the coronavirus, following a fiscal stimulus announcement in September.
A report by BofA Securities said that due to policy initiatives, China will again appear on the path of growth.
Respondents to a survey conducted by BofA said the situation was different this time and indicated they were moving back to China rather than looking for opportunities elsewhere.
The survey also found that their reallocation towards China is coming at the expense of Indian equities.
In the current month, foreign investors have withdrawn about eight billion dollars from the Indian market. The survey said that in August a large number of fund managers in India were overweight, but now the situation has changed and the number of underweight has increased instead of overweight.
The mood among fund managers is changing due to analysts’ warnings about high valuations in Indian equities.
China’s equity index rose significantly last week. Valuations of China’s equities currently look attractive and investors are expecting a rebound due to stimulus.
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