Christopher Wood, global head of equity strategy at Jefferies, said that although he currently prefers Chinese stocks over Indian equities, he believes that the Indian market has now corrected. Speaking at an event organised by Business Standard, the market expert noted that India's consumption stocks seem very attractive in the current scenario.
Chris Wood said Jefferies is definitely not in a "greed" phase now for India, as it was earlier in September when the country's equity markets recorded new peaks. "The good news is that India has already corrected," he said.
When asked if the world is prepared for the "harsher tariffs" as threatened by US President Donald Trump, Wood said it isn't. "There is a fundamental contradiction in Donald Trump's economic agenda. The bullish part of the agenda is tax cuts and deregulation. That's why, the financial stocks in America rallied after he was elected," he said, while adding that the US stock market is expected to see a decline from now onwards.
Wood said that Trump's tariffs and immigrations controls are "fundamentally bearish". "I don't think Elon Musk believes in tariffs. So I am hoping that tariffs are first and foremost a negotiation tactic. But if I am wrong, the tariffs will be negative for Americans. They already face high inflation. Everything in the US is currently a rip off. Higher tariffs will make life more expensive for Americans," he said.
Speaking about why he prefers Chinese stocks over India, Wood said that the former is currently very cheap, after having bottomed out last year. The recent actions taken by China’s central bank and government also gives hope to the equity markets, along with the emergence of Deepseek. The Chinese charts seem to be better than those of India, he said, adding that he reduced his exposure to Indian markets.
Wood added that valuations earlier in the Indian market were clearly very high. In the current scenario, there is no hurry to buy Indian shares. "If you have no Indian equities at all, I would start buying now. If you already own a lot of Indian equities, I would wait," he said.
Wood said the persistent FII selloff in the Indian market has surprised him. He said the initial wave of FII selloff may have been directed towards Chinese equities. The second wave may have been caused by the disruption caused by DeepSeek, a Chinese artificial intelligence startup. Wood said the continuous inflows from mutual funds is a positive indicator.
Also read: FIIs net sold shares worth Rs 3,529 crore on Feb 25
"Heavy lifting on capex investment is being done by the Indian government. But it's a relay race, and private sector needs to take the baton. However, at this point, markets seemingly don't believe that private sectors will do so," he said, while adding that the government has done enough to boost investment.
Wood, however, advised investors to turn away their portfolio from investment to consumption as the latter sector's stocks are expected to get a boost from the recent budgetary measures and other reforms. He also advised people to invest in travel stocks, stating that it should be the "investment story" for the next several years now.
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