HSBC downgrades Indian equities second time in a month amid Iran war
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HSBC has downgraded Indian equities to “underweight” from “neutral” as global oil prices remain high amid the war in West Asia, Reuters reported on Thursday.
This is the second time the global brokerage firm has downgraded Indian equities in a month. It had demoted Indian stocks to “neutral” from “overweight” on March 31, CNBC-TV18 reported.
The downgrade means that the firm has advised investors to hold fewer Indian stocks because of inflation and high oil prices hurting corporate earnings.
On Thursday, the benchmark Brent crude was trading above the $100 per barrel-mark as uncertainties continue about whether more talks between the United States and Iran to end the conflict will take place.
The price of Brent was $78 per barrel on February 27, a day before the conflict started.
Against this backdrop, Indian stock indices, along with those in Tokyo, Hong Kong, Shanghai, Sydney, Singapore, Taipei, Bangkok and New Zealand’s Wellington were down on Thursday, reported AFP.
In India, the benchmark Sensex has fallen nearly 7.9% and Nifty about 6.7% this year, according to Reuters.
In view of this, HSBC said in a note on Thursday that “India now looks less attractive than North East Asian peers in the current macro setting”, reported the news agency.
It added that the war in West Asia “has refocused attention on downside...