HYDERABAD:India continues to be the most favoured destination despite global investors reducing their exposure to emerging market equities, said Bank of America Merrill Lynch (BoF-ML).
India topped the global emerging market investors’ country preference chart followed by China and Poland in the second and third place, respectively as Asia Pacific investors increased their allocation to India and Taiwan in June.
According to the global financial major, global investors have reduced their exposure to emerging market equities amid weak earnings prospects, weak Chinese economic growth and a strong dollar.
“Despite having lost 14 per cent (in dollar terms) since January highs, India continues to be the most favoured country for GEM (Global Emerging Market) investors,” BofA-ML report said .
As per latest data from depositories, foreign investors pulled out more than Rs 3,300 crore from Indian stock markets so far this month, on account of better returns from Asian peers, concerns over a slow revival in corporate earnings and continued worries over taxation issues.
Other countries in the list included Turkey, Indonesia, Mexico, Korea, Thailand and South Africa.
The BSE’s benchmark 30-share sensitive index closed 0.74 per cent or 200.34 points higher at 27,316.17 points on June 19. So far in 2015, the index lost 191.37 points or 0.69%.
According to June’s BofA-ML Fund Manager Survey, globally investors have moved out of equities into cash ahead of an expected US Fed rate hike. Investors have also shown concern about a Greek default and a possible bubble in Chinese equities as they have scaled back risk.
