Amundi Predicts Indian Equity Rebound Following US-Iran Conflict
Amundi Investment Institute forecasts a recovery for Indian equities if the US-Iran conflict ends, citing resilient domestic demand despite high oil prices.
The Amundi Investment Institute predicts a potential rebound for Indian equities contingent on the end of the conflict between the United States and Iran. Alessia Berardi, the firm's head of global macroeconomics and emerging markets strategy, identifies the war as the primary driver of high oil prices and inflation, which have pressured India's oil-dependent economy since late February.
These macroeconomic pressures, alongside subdued earnings growth and more than $30 billion in foreign outflows, contributed to a nearly 14% decline in the NSE Nifty 50 Index. Despite the market downturn, Berardi remains positive about India's economic performance, pointing to growth in the manufacturing and defense sectors as well as resilient domestic demand.
This outlook aligns with recent data from the Reserve Bank of India, which upgraded its fiscal year growth forecast from 6.7% to 7.1%. Berardi noted that while the equity market currently holds a pessimistic perception of India, she believes the seeds of a good economic performance are present.
