Mumbai:
In view of the return of Donald Trump to America and the rapidly growing Indian economy, international brokerage firm CLSA Limited has made a major change in its investment stance. Hong Kong-based CLSA has announced that it will now reduce investment in China and focus on India and increase investment there. This decision has been taken by the international brokerage firm at a time when China’s economy is facing challenges. Whereas investment prospects in India are looking better every day.
CLSA has given this information in a report ‘Pouncing Tiger, Prevaricating Dragon’. Analysts Alexander Redman and Wei Sheng Wan said, “The initial reaction to the PBOC stimulus was to rent rather than buy. Yet we committed funding by deploying some of our overexposure to China in early October. We 14 November 2024 We had said this in our report ‘Pouncing Tiger, Prevaricating Dragon’, now we change our stance.”
Good sign for Indian market
This stance of CLSA is a good sign for the Indian markets, because during the last few months, foreign institutional investors (FIIs) have pulled out money from India on a large scale. In this situation, a change in the attitude of an international brokerage firm can have a positive effect. CLSA has also noted that India’s growth rate remains strong. In such a situation, the strongest opportunity for growth is visible in India only. Long term valuation of Indian stocks has also attracted investors.
Rising inflation poses challenges for China
This brokerage firm says that the rise in US bond yields as well as rising inflation have created challenges for China’s monetary policy. Apart from this, the risk premium received on assets in the Chinese market has also decreased. Therefore, China’s market is no longer as important for foreign investors as before. CLSA said in its report that the Chinese market no longer looks that profitable. Therefore he should move towards India.
It is necessary to improve domestic demand
It is very important for China to improve its domestic demand. Especially after the victory of Donald Trump in the US presidential election, it has become necessary to do this. Trump has talked about imposing 60% tariff on most Chinese exports. The decline in exports from China will be a blow to the Chinese economy. Because China’s exports will have to suffer losses due to increase in duty.
