EPFR Global expects some money coming back to India by the end of this calendar year, Cameron Brandt, director of research, told CNBC-TV18. However, Brandt believes it's going to be a cautious end to the year. He also mentioned that currently, US stocks are where his focus lies and within the EMs, he is positive on China.
“India will see some money coming back in towards the end of the year (2021), some of the indices have done quite well. However, it will be a cautious end to the year; emerging markets' equity funds often do quite well in the final six weeks, but there are so many narratives often competing in the moment that investors have a very hard time working out which one should dominate their investment decisions,” Brandt said.
On US markets, he said, “The focus is very much on US equities at the moment. The big storylines driving flows recently have been two sets of rising numbers. The good side is that corporate earnings have been much stronger than people were expecting, but on the other hand the inflation numbers are worse than people have been hoping. So how to reconcile the two? At least, at the moment the preferred answer seems to be to get more exposure to US stocks.”
However, said Brandt, the focus has largely been on China in the emerging markets. “Most of the other emerging market (EM) groups have had lacklustre inflows or outflows, but it’s been China funds driving the EM side for the past couple of weeks,” he said.
For the entire interview, watch the video