HSBC's first downgrade for Indian markets in one year

May 13, 2015 14:50

In the first major downgrade for Indian markets in the past one year, global brokerage HSBC today changed its stance on the country to "underweight", saying corporate earnings may remain muted, monsoon could be weak and odds are against further rate cuts.

HSBC further said that India has become the second most expensive and one of the most over-owned markets in Asia, after a strong rally on the back of reform optimism generated by the Modi government over the past one year.

It also upgraded its stance on markets like The Philippines and Hong Kong.

"We lower our equity market weighting for India from overweight to underweight. Also, we raise the Philippines to overweight from neutral and Hong Kong to neutral from underweight," HSBC said in a research note.

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