Global financial services major HSBC has downgraded Indian equities from “overweight” to “neutral” citing that the country would struggle to defend a falling currency and declining growth.
“We lower our weighting in India from overweight to neutral. In our view, India will continue to struggle with the trade-off between defending a currency and supporting growth,” HSBC said in a research note on Friday.
According to HSBC, the volatility in Indian markets since May can be attributed to the initial talk about tapering of bond purchase by the US Federal Reserve. PNS