Foreign Investors Still Bullish on India: BofA-MF

MUMBAI: The fall in the markets since January has not dampened the spirits of foreign investors, who continue to allocate more funds to Indian equities.

Over 90% of the 167 fund managers polled by Bank of America-Merrill Lynch (BofA-ML) have voted India and China as their most favoured investment destination.

“Despite having lost 14% (in US$ terms) since January, India continues to be the most favoured country among GEM investors,“ the BofA-ML report said. While fund managers are still maintaining `overweight' positions on China, they have cut their allocations significantly over the past few months.

“With the Shanghai Stock Exchange Composite Index up about 150% in the last year and with no sign of an earnings revival, 70% of global investors believe China equities are in a bubble,“ the report said. AsiaPac investors increased net overweight allocations to India and Taiwan in June. Thailand aside, ASEAN markets remain unloved by most EM fund managers. Thailand moved to a small net overweight this month.